Escalating Costs of Essential European Food Items Persist

by Ethan Kim
food price inflation europe

Before you generously drizzle olive oil over your dishes, pause to consider its surging cost.

As a fundamental ingredient in Mediterranean diets and a frequent addition to salads across Europe, olive oil is now a prime illustration of a commodity whose price increases continue to outpace the general rate of inflation within the European Union.

Since January 2021, the cost of olive oil has surged by approximately 75%, overshadowing the general annual inflation rate, which itself has been alarmingly high in recent years, reaching 11.5% in October of the previous year. Notably, a significant portion of the food price inflation has occurred within the last two years.

In Spain, which leads the world in olive oil production, there was a 53% price hike in August over the previous year, culminating in a staggering 115% increase since August 2021.

Eurostat, the statistical office of the European Union, has noted that the price of potatoes, another basic food item, has also seen a remarkable increase. By September 2023, the cost of potatoes had escalated by 53% since January 2021.

While families with higher and middle incomes may be able to withstand such price hikes with relative ease, they pose an increasingly heavy strain on lower-income households. These groups have often seen their wages stagnate, unable to keep pace with the inflationary trend.

The European Trade Union Confederation (ETUC) highlights that nominal wages in the EU have risen by only 11%, exacerbating the disparity between earnings and living costs.

“Nominal wages continue to lag behind the rising costs of basic groceries, even for those employed in the agricultural sector, driving a growing number of workers to depend on food banks,” states Esther Lynch, ETUC’s general secretary.

Although the annual inflation rate decreased significantly to 2.9% in October, marking the lowest in over two years, food inflation remained high at 7.5%.

The increase in grocery prices in Europe has been more pronounced than in other developed economies, ranging from the United States to Japan. This surge is attributed to escalated energy and labor expenses and the repercussions of the conflict in Ukraine, despite a decline in food commodity costs for consecutive months.

While the ETUC accuses large agricultural industries of profiteering during these challenging times, the olive oil industry has encountered distinct difficulties.

In Spain, farmers and industry specialists attribute the soaring prices primarily to the near two-year drought and rising temperatures which affect crop flowering, along with inflation impacting fertilizer costs. The Spanish Agriculture Ministry forecasts that the olive oil yield for the 2023-24 season will be about 35% below the average of the last four years.

This report has received additional contributions from Ciarán Giles in Madrid.

Frequently Asked Questions (FAQs) about food price inflation europe

How much has the price of olive oil increased in the EU since January 2021?

The price of olive oil has increased by approximately 75% since January 2021, significantly outstripping the general inflation rate.

What is the current situation with food inflation in the European Union?

As of October, while the annual inflation rate in the EU fell to 2.9%, food inflation remained high at 7.5%, reflecting the persistent upward trend in grocery costs.

What impact does the rising cost of food have on European families?

The rising cost of food disproportionately affects lower-income families in Europe, as their wages have not kept pace with inflation, increasing their reliance on food banks and financial aid.

Why are grocery prices rising more sharply in Europe compared to other advanced economies?

Grocery prices in Europe are rising more sharply due to increased energy and labor costs, coupled with the impact of the war in Ukraine, despite a decrease in global food commodity prices.

What are the reasons behind the increase in olive oil prices in Spain?

The increase in olive oil prices in Spain is attributed to the prolonged drought, higher temperatures affecting crops, and inflation that has raised the costs of fertilizers. Spain’s olive oil production for the 2023-24 season is expected to be nearly 35% below the four-year average.

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Peter Grifin November 6, 2023 - 12:13 pm

totally crazy how everything’s getting more expensive can’t even enjoy a simple salad without thinking about the cost now

Anna94 November 6, 2023 - 3:51 pm

just read about the price hikes in olive oil and potatoes, like, where does it end with these increases? families are struggling enough as it is…

LocalChef November 6, 2023 - 6:26 pm

running a restaurant with these prices going up is a nightmare don’t know how we’re supposed to manage without upping our prices too

ecoWarrior November 6, 2023 - 11:56 pm

seriously though, it’s not just about the prices it’s the drought and climate change affecting crops we need to look at the bigger picture here

BudgetMaster November 7, 2023 - 8:58 am

what’s the point of a salary raise if it can’t even keep up with inflation talk about a losing battle amirite


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