Spanish farmers warn on agriculture inflation

Analysis: Electricity prices are up 300%, fertilizers up 100%, diesel up 40-60%, plastics up 50%, water up 30%.
By Matthew Bennett
Nov 02, 2021, 7:45 pm

Spanish farmers have warned agriculture production costs are skyrocketing and want "urgent" help from the national and regional governments to stop producers being crushed by wholesale buyers trying to keep prices in supermarkets down.

COAG says the "brutal" rise in price will lead to "significant production cuts in the Spanish countryside".

The farming organistion says electricity prices are up 300%, fertilizers up 100%, diesel up 40-60%, plastics up 50%, water up 30% and animal feeds up 25%.

They estimate the cost of bringing a truck of fertilizer online in a field has gone up from €4,000 last year to €8,000-10,000 now.

"In the case of olive irrigation, the electricity bill has gone up €160 a hectare, which means an average plantation (25 hectares) is looking at a €4,000 rise compared to last year."

"A gauge of western European prices for ammonia, used to make nitrogen fertilizer, surged to a 13-year high to $910 a metric ton", reported The Independent, citing natural gas prices as the driving force. This is what that looks like in a graph.

Fertilizer prices in the United States are also at record levels. Globally, food price indices rose to their highest level since 2011 in September, with an especially significant rise in the price of vegetable oils.

The general annual inflation rate in Spain rose to 5.5% in October, its highest level since August 1992.

On Sunday night, Algeria closed the gas pipeline that runs through Morocco to Spain. Plan B involves bringing part of Spain's natural gas supply from the North African country over on ships.

How long will these prices rises take to reach Spanish supermarkets? How will farmers and farm workers struggle and react in the meantime, this coming winter?

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