The problem of drought is already affecting the price of food. The absence of precipitation during the months of March and April, together with the pessimistic forecasts for the next fortnight, lead the Government to conclude that the announced drop in the price of food will be postponed indefinitely. "It's a moment of great uncertainty", pointed out yesterday the Secretary General of Agriculture, Fernando Miranda, who pointed out that the weather situation is starting to have inflationary effects in certain productive sectors.
The Minister of Agriculture, Luis Planas, stated in February that "we have reasons to think that the CPI for food has reached a ceiling". He pointed out that the international price index prepared by FAO was falling, which, added to the drop in the price of certain raw materials, fertilizers or energy, opened the way to a scenario of price moderation. But in this situation the drought has broken out, which, according to Agricultura, will make "the supply of certain products scarcer and have an inflationary trend".
The ministry also pointed out that the absence of rain will affect the most specific productions in Spain. The olive grove stood out; stone fruit, which is now starting its season, or citrus fruits. "They will be the most harmed", he pointed out. Miranda also emphasized that, however, if the precipitation returns from May, "cost inflation should be moderated". He added that at the moment it is complicated to set a date for this decline, which should be reflected in the consumption basket.
For his part, Minister Planas defended that he prefers not to talk about "reduction" in the price of food, but about "containment", for the time being. He emphasized, after yesterday's Council of Ministers, that the increase in the basic basket is a problem for the entire European Union and that Spain is below the Community average.
It was a year in which Spanish households reduced spending on basic products by 1.8% as a result of inflation. In this way, consumption per capita fell to 1,427 euros. Likewise, the volume of global consumption contracted by 1.1%, to 66,294 million, according to the annual report prepared by the Federation of Food and Beverage Industries (FIAB) and the Ministry of Agriculture.
Food companies saw moderate growth last year. Real production amounted to 144,955 million euros and achieved an increase of 1.5%, a figure far removed from the increases of 4.5% prior to the pandemic. Production prices increased by 18.6% and the sector closed the year with 30,159 companies, with Catalonia, once again, as the leading region in terms of industrial presence.
According to the employer, the measures approved by the Government to try to reduce inflation managed to ensure that the increase in the final prices of the consumption basket was not greater. However, its chief executive, Maurici García de Quevedo, criticized the exclusion of meat and fish from the VAT reduction. He also put the impact of the plastic tax at 1,000 million euros per year.
