Agriculture minister attributes inflation to raw material and energy costs, rules out misuse to boost margins, though advocates “responsibility” of distributors
The basic shopping basket, that of freshly purchased food almost daily, will remain high in the coming weeks until Christmas. In these key weeks for consumers’ wallets, the price of these products will “stabilize but not fall”. This has been indicated by the Minister of Agriculture, Fisheries and Food, Luis Planas, who reviewed the inflation data for October, which led to an increase in food production of more than 15%, one of the highest rates in recent decades.
Planas expects “a moderation in food prices to take place in the coming months”, and above all, he has pinpointed the turning point of this post-Christmas escalation of food. The minister expects that “early next year” food “will decrease significantly”. That will happen as inflation eases further (from 7.3% in October) as Agriculture sources indicate that the immediate swing from inflation to food will not happen soon, but will take weeks.
In any case, Planas wanted to maintain that “we are dealing with a cost problem and not a business margin problem.” “The food chain behaves correctly in Spain,” he indicated. It’s “balanced,” he said. “It’s costs, not margins, that mark food,” he insisted.
The minister has made “a call for responsibility”, especially “from those who have more weight” in the food chain, i.e. from the large commercial surfaces and distributors, who are the ones who have the most power over the entire basket of the purchase because of the amount of business they handle. It is, in reality, the same message that Labor Minister Yolanda Díaz urged yesterday to prepare a basic shopping basket with low prices for supermarkets. Although Planas has qualified that in addition to proposing this measure, what he is doing is calling for “to take a step forward” to “try to limit the scope of price increases”.
The cost of many of these products, such as sugar, oil, eggs, meat or milk, has increased due to an increase in energy (gas and electricity), but also due to the increase in raw materials (fertilizer, grain, fertilizers, etc.) on the international market as a result of the war in Ukraine. In that context, according to the minister, a serious drought has been added, as a result of which the shopping basket has not stopped rising in the past year.
Planas has confirmed that the value chain law, launched this year, is “fulfilled” and that it provides transparency. In any case, it has called for the “reporting” of practices that do not comply with that law, as indicated by some of the small producers. “If there are cases, you have to report them,” he stressed. In addition, he recalled that the new electronic registration of contracts will come into effect on January 1, another measure that will try to provide transparency in the process from the field to the store.
Source: La Verdad
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
