Agricultural production is collapsing

A combination of circumstances predicts the end of cheap food.

From rice to oil, passing through cereals, Spanish agrifood production is plummeting and it is threatening with an important increase in prices over the next few months. Fruit and vegetables will be no exception to this.

The drought, the unprecedented rise in production costs and the increase in temperature have meant that production dropped by 24.6%, according to data provided by the Ministry of Agriculture, Fishing and Food.

Fruit is amongst the most affected foods. This is the case of lemon production, which has experienced a 34.6% drop; oranges, with a production that has fallen by 19.6% and apples that have dropped their offer by 16.6%. In vegetables, beans are the worst affected, with a drop of 27.6% and peas with 18.8%. The potato harvest has also suffered a significant reduction, going from 2,081 to 1,942 million tonnes, meaning a drop in production of 6.7%.

Although inflation of foodstuff at the point of sale has reached 15%, the prices in the fields have not covered the production costs for many productions, bringing losses on the market of 300 million for the producers. All the agricultural costs have risen in 2022, reaching record-breaking levels. The inputs that have risen in price most have been the fertilisers, by over 62%, although some nitrogenous compounds and urea have doubled and tripled their price. Energy represents another separate element, with an increase of virtually 50% (some irrigation organisations have paid invoices that are 4 or 5 times higher than the price prior to the Ukrainian armed conflict) and plant protection products have gone up by around 20%. Agricultural diesel dropped its price at the end of 2022, but remained 70% higher during the rest of the year.

The successive bad weather conditions (frosts, lack of hours of sunlight in the spring, persistent rainfall, hail, drought, heat during the winter, etc.) have caused unprecedented, but generalised, reductions in the harvests. The most dramatic case in fruit occurred in the persimmon production, which fell by up to 70%.

The latest figures

In this situation, Spanish inflation continues to be driven by food prices, which increased over the last month by 15.7%, four tenths more than in November, meaning a historic record in the rise of the price of the consumer shopping basket. A food as basic as the potato has increased its price by 22.6%.

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