Producer and agricultural economist Dimitris Antonopoulos speaks to Documento shedding mild on the outrageous worth fluctuations of agricultural merchandise
In the previous couple of days we’ve got had unhealthy information once more from the meals accuracy entrance, which considerations the overwhelming majority of Greek households. On the one hand, the information printed by ELSTAT for the month of April confirmed that with a common inflation of three.1%, meals costs “stung” as common by much more, i.e. 5.4%, with the largest will increase recorded in olive oil ( 60.7%), in mineral waters – gentle drinks – fruit juices (12.5%), fruits (11.65%), recent fish (10.6%), in rice (8.5%), in greens (6.5%) and so on. However with meals inflation working at greater than twice the pace final yr – April 2023 annual meals inflation was 11.4% in comparison with this yr’s 5.4% – authorities officers have come out and mentioned that though meals worth hikes persist, no less than are famous at a slower charge.
Nevertheless, on the identical days, the information of the output worth index in agriculture – livestock breeding for March 2023 have been printed, which confirmed precisely the alternative. That’s, the costs at which farmers and breeders offered their manufacturing in March 2024 have been 18.1% larger than final yr, whereas a yr in the past, in March 2023, the rise in costs for main manufacturing merchandise was much less and from half, 8.2%. In fact, right here too there was the identical image when it comes to particular person merchandise, with worth will increase in olive oil reaching 79.7%, in fruits 31.95%, in potatoes and seeds 13.85%, in greens 5.6%, in wine 5.5%, and so on.
And as speak of meals worth hikes peaked, customers who went purchasing for cucumbers, tomatoes, courgettes, carrots, onions, eggplants, potatoes and inexperienced beans final week have been stunned to find that greens have been lastly getting cheaper as a consequence of a giant drop in costs. wholesale by 20-40% within the Central Vegetable Market of Rentis.
To shed a bit extra mild on all these sophisticated worth actions in meals, particularly recent merchandise produced in Greece and till two or three years in the past we purchased them cheaply however since final yr we noticed them at Belgian costs, Documento requested inquiries to the agricultural economist , producer and columnist Dimitris Antonopoulos, the most effective connoisseurs of the trendy Greek agricultural economic system.
What’s the purpose for the massive ups and downs in vegetable costs recorded by ELSTAT and seen within the Rentis market worth sheets?
It is a matter of provide and demand. Costs change each when there’s numerous product and when there’s not numerous product. In earlier years, with the very giant enhance in manufacturing prices, producers have been cautious of placing merchandise in abundance and, above all, treating them. When a sack of fertilizer reached 150 euros, you skimped on it. So the supply was fairly restricted. Alternatively, the demand additionally strikes in keeping with the obtainable incomes, which additionally rise and fall, and the price is paid every time by the producer. So it made sense to have restricted manufacturing for some time.
However little by little the costs of inputs (fertilizers, electrical energy, and so on.) dropped so much and the producers bought discouraged and put extra stuff in, growing the availability of greens. Not the fruits, as a result of the fruits are bushes and have autonomous manufacturing, they don’t rely a lot on remedies.
Plus, this yr, as a consequence of summer time, the open subject crops got here 15-20 days earlier and coincided with the greenhouse crops. We have been additionally proper after Easter when there’s a drop available in the market. It is a frequent phenomenon, it’s not the primary time that a big drop in vegetable costs has been recorded for a time frame. It is simply that we now sit with the site visitors mild and detect it as a result of we’ve got excessive inflation.
So the drop in vegetable costs is momentary and in a few months the costs will rise once more?
Value modifications are the norm for greens. They themselves put a bit extra, rather less. However lately, as a consequence of excessive prices, this steadiness has been disturbed and the brand new steadiness has not been reached.
Can we predict something about costs in the summertime?
To any extent further, as a result of tourism additionally enters and there are various mouths, imports start, that are dearer by their nature. Tomatoes are imported from Poland, from Belgium which is on the opposite facet of Europe, so to get right here they want refrigeration, transport, packaging supplies and the costs are proportional.
In its spring forecasts for the agricultural markets, the Fee said that though the costs of fertilizers, vitality, provides, and so on. have declined in comparison with the earlier two years, they’re nonetheless very excessive in comparison with 2020.
It is too excessive. That they had reached unimaginable ranges. A sack of fertilizer that we used to purchase for 14 euros in 2020 went for 40-42 euros and is now at 22 euros. It’s not at double worth from 2020 however it’s excessive. In feed costs fluctuate, vitality is “one and the opposite”. PPC now has a particular coverage for rural electrical energy and based mostly on it we’re the place we have been in 2020, perhaps a bit larger, however the utilities, ETMEAR, have elevated, it’s not possible to maintain observe of all this.
Why did olive oil costs enhance 80% this yr?
Because of the drought in Spain which has 50% of the world manufacturing. There have been two years of very extreme drought in Spain, so extreme that the producers have been afraid not just for the fruit, but additionally for the bushes. The manufacturing in Spain was drastically diminished and within the second yr Italy adopted and this yr all of us had poor manufacturing within the Mediterranean.
The olive tree is now beginning to present what fruit it’ll bear, we’re not positive, it nonetheless wants a bit time to see what number of eyes will bear fruit, however it appears that evidently we’re going for a standard yr. The issue with these is that there’s a enormous commotion, an enormous fuss from individuals who know and do not know after which the inventory markets get within the center and blow the costs up. Along with the grain change, there are additionally smaller oil exchanges in Spain and Italy. This sort of hypothesis is booming. And simply as there was no scarcity of drams in wheat, I think that there will likely be no scarcity of drams in olive oil both, in the long run there will likely be surplus portions that some merchants or producers had stored. That is my private evaluation and it’s confirmed by the truth that producer costs fell inside a month by 2 euros. We nonetheless do not know what’s going to occur, we would like six full months to get manufacturing and but the costs began to fall solely as a result of the olive is displaying optimistic indicators. Now we both eat or gamble, that is my opinion. Which applies internationally, it’s not a matter for Greece.
It’s mentioned that the shortage of labor has contributed to the rise in costs of Greek fruit and veggies.
Certain. It additionally drastically will increase the price and impacts the supply of the merchandise. So one purpose farmers did not plant numerous greens is that they have been afraid they would not discover a technique to harvest them. It’s no small factor that your harvest has been carried out and you might be sitting it. To cope with this drawback, many farmers invested in costly mechanical gear. Plenty of funding was additionally made within the administration of the manufacturing from the sector, in putting the merchandise in crates, in vibrating machines. All this solves the price points and primarily the uncertainty of the employees. And naturally the every day wages have elevated so much: from the very low worth of 25-30 euros in 2020, presently the every day wages are at 40-50 euros and if there’s a giant olive manufacturing this yr, the every day wages will go very excessive.
Do you might have an concept of what is going on in Thessaly from an agricultural standpoint?
I’ve no image of Karditsa, it was in a foul state even earlier than Daniel and its villages have been closely abandoned. However Larissa and Volos appear to be overcoming it. Nevertheless, there’s a very giant exodus of farmers, both to pensions or to private and non-private tasks and photovoltaic installations. Many farmers and migrants left final yr in November-December when the demand for tasks appears to have peaked. We additionally see numerous gear packages being offered, to some extent we have by no means seen earlier than and we do not know what it means: perhaps some individuals bought new ones with the so-called improve plans and are promoting the previous ones, however perhaps there is a large exodus of farmers.
“Villages are deserting, manufacturing prices are rising”
In a examine you had proven that the worth of the manufacturing could be very small in comparison with the subsidies, but we see their merchandise reaching very excessive costs within the cities. How is that this defined?
That merchandise fetch very excessive costs within the cities is a way more complicated situation. It occurs as a result of they’ve a really excessive value construction that relies upon not solely on the producer’s earnings but additionally on the price of manufacturing. Manufacturing prices are excessive for a lot of causes. Firstly, as a result of the holdings are small; secondly, as a result of they’re out of date; thirdly, as a result of they’re scattered; fourthly, as a result of they don’t rely in any respect on trendy science and expertise; fifthly, as a result of the enter market is fragmented, small and really costly. That’s, contemplate that the village the place I’ve crops and Lamia have a 20-25% distinction in costs. So the entire mannequin could be very antiquated and produces with applied sciences and views which might be outdated, so the price could be very excessive.
Alternatively, the price of assortment and transportation both to the manufacturing unit or to Athens or anyplace could be very excessive as a result of we’ve got small producers, so the truck stops to take two pallets from right here, one from there, it is waste, it is tolls, they add up.
Nevertheless, manufacturing is being concentrated, there are various who’ve stored their kids and have constructed giant farms, they’ve purchased giant tractors.
There was fast modernization lately and nice modifications are going down within the countryside. The villages are being abandoned, so the aspect of rural life is misplaced and the youthful individuals go to the cities, however this additionally has its positives as a result of they’re ossified with the city life-style, in order that they acquire information and a lifestyle and work, however there’s an added value of 20-30 km. on farms on daily basis.
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