Filling the refrigerator is very expensive, a reality that puts pressure on the entire food chain and extends over time, because the brake on inflation has not yet arrived due to the drought and war in Ukraine, warns the general director of the employer of the food industry, Mauricio García de Quevedo.
The Federation of Food and Beverage Industries (FIAB) expects 2024 “more normality” and that the exceptional situation experienced by some products such as extra virgin olive oil will not be transferred to other products, according to García de Quevedo. with Eph.
And he called for a Government to work for the competition of companies and take steps to solve this problem and not others that were targeted last year – such as the price cap – which could lead to “disaster.”
Question (Q): After the first half of the constant price increase, what are your prospects for the end of the year?
Answer (R): THE second semester is also full of unknowns. We expect a slowdown in inflation that did not happen due to the drought and the war situation in Ukraine, the impact of which has been exacerbated by the end of the Black Sea agreement and the Danas.
All of this has taken a toll on yields and shifted our expectations to a slowdown; We expect the second semester, again, with tight margins for the food industry.
Q: The increase in the price of extra virgin olive oil is one of the concerns of the Spanish people and is in the media spotlight. Could something similar happen in other productions?
A: If everything continues as it should, I don’t see any other product category suffering this stress. We hope that the situation will relax and that in 2024 everything will be more normal.
Q: With the return of this hot and dry summer, FIAB warns of the impact of drought on food production. What can cause more water shortage in the structure?
The supply of food products is guaranteed, but the problem is that the agri-food value chain suffers because the main production is done as a result of the drought, because neither the quantity nor the quality required by many cases to get the products achieved.which we usually have. We have to resort to imports or other types of issues. At this point, we consider a National Hydrological Plan essential, a more efficient use of water and infrastructure.
Q: The food industry fabric has a unique structure, what does it do in this very complex scenario?
A: Pressure on industry margins does not always translate into final sales prices. We have many small and medium-sized businesses and they are suffering the most. Last year, 150 closed, which did not absorb this inflationary situation and, this year, it will be a similar number. All product categories behave more or less the same, so it’s the size of the company that makes it vulnerable.
Q: All this in the economic field, but we must add the political situation in Spain.
A: The political situation only adds more uncertainty to the equation, because there is a lack of a Government capable of correcting the steps and helping this process.
Q: What will be the effect if this situation is delayed?
A: The truth is that we are very worried. We need a government committed to competition. We must immediately implement some fiscal measures and we have a plastic tax, which is a big mistake. There is also Perte Agroalimentario which failed in the first call. We hope that the second one is more flexible and, in principle, they are ready for work.
Q: VAT has been lowered but the current Government seems to have not forgotten measures such as limits on shopping baskets and even launched ideas such as public supermarkets. What opinion do they deserve?
A: The party proposing these types of measures is the minority party within the government currently in office. We know that the majority party does not care about them. We don’t believe it will happen, because it would be a disaster. In countries where it is implemented, the effect is completely opposite.
Q: The Spanish food industry has experienced a success story in foreign markets. Are you at risk because of the situation of uncertainty and inflation?
A. We continue to have a relevant export capacity. In 2022, we see, however, something that has not happened for a long time, which is a drop in sales volume as a result of the global context. We think this is a temporary thing and it will not affect the smooth flow of our exports. We continue to open markets and continue to have a strong position, selling 35% of production abroad. This road will continue.
However, we have two new clouds to solve: the tariffs in the United States – which remain suspended – and Brexit, which is a real administrative complexity.