Spain: The food chain on high alert
The truckers' strike is pushing the entire agro-food sector to the limit. After the recent masse farmers' demonstration due to their loss of competitiveness, self-employed truckers are now contributing to provoke an unprecedented collapse. The situation is further worsened by the Ukraine’s invasion as Spain needs an alternative source of cereals and sunflower oil.
If just a few days ago we reported the negative repercussions of the Ukrainian invasion on their shipments of cereals and sunflower oil to Spain Ukraine is a key supplier of some commodities to Spain | Nieuwsbericht | Agroberichten Buitenland, despite having reached an agreement on financial support, the Platform of self-employed haulers said that they will continue the strike started on March 14. The group is not affiliated with Spain’s larger national trucking associations or road haulage companies and did not enter negotiations with the Spanish government.
Energy costs drive truckers' strike
The government has unveiled a €1 billion plan to reduce fuel prices amid an unprecedented strike by lorry drivers. Spain’s government announced that it would discount €0.20 per liter of gas for lorries as part of the package of measures. Spanish Transport Minister said the "historic" agreement would save around €700 a month per vehicle. She said it would also provide €450 million euros in direct financial aid to road haulage businesses, as well as special credit terms.
The strike was a small demonstration from a minor transport association but has snowballed into a biggest protest. “We have stopped working because we cannot keep losing money”, said the president of the Platform for the Defense of the Transport Sector. The protest has channeled the growing social discontent in Spain as it suffers the consequences of inflation that is linked to soaring energy prices.
The walkout has threatened to disrupt national supply chains, with some businesses reporting shortages of fresh produce such as milk and fish.
Farmers and livestock owners are suffering the consequences of the strike, but they share some of their problems. “This is a problem that is now affecting all society and sectors, but for us farmers and livestock owners it’s something we’ve been suffering for months”, a cereal farmer said.
The fishing fleet is moored
The sector most affected by the strike is the fishing sector. Apart from that, the fishing fleet of almost the whole country will remain moored until they hold a meeting with the Minister of Agriculture to demand aid for the increase in the price of fuel.
The haulers’ strike is starting to cause shortages, not only of fuel itself, but also of some fresh products such as milk, fish, meat, fruit and vegetables, as well as beer, soft drinks and even car distribution. The fear of possible shortages due to the strike and the solidarity of Spaniards with Ukraine have boosted food purchases in supermarkets in the tenth week of the year, from 7 to 13 March. Specifically, that week, sales in supermarkets increased by 23% over the same week of the previous year, the average for previous weeks being 6%. Of all the data analyzed by NielsenIQ, the upturn in oil consumption stands out, with growth of 289%.
Sources from the sector explain that in the last few hours the tension had decreased in some areas where the conflict was felt most strongly. Every day of strike the cost is higher. It is costing retailing €130 million a day more to be able to supply shops in these extreme circumstances. Never before, even in the first phase of the pandemic, has the supply chain been so strained.
The shopping basket is 7.6% more expensive than a year ago
Due to higher energy prices but also to the influence of other key products, such as groceries, Spanish consumers can buy less and less with the same budget. This problem starts in the factories as the food industry is raising prices by an average of 10% before their manufactures reach the supermarket.
In February, meat processing industries increased their prices by 4.2% compared to the same month of the previous year, while fish processing industries increased their prices by 6.5% and fruit and vegetable processing industries by 7.5%. Dairy products also rose by 4.6% at the factory gate and bakery products by 6.5%.
“If the countryside dies, the cities don’t eat”
Thousands of growers, livestock farmers, fishermen and hunters took part in a demonstration in Madrid on March 20. It was a cry for help in an unprecedented protest march, long postponed because of the appearance of the pandemic. The organizers, the 20Mrural Platform, insisted they didn’t want charity, they just wanted to be able to continue with their own way of life.
The protesters –over 150,000 according to initial estimations and 400,000 according to the organizers- shouted that the rural world is dying, strangled for years and especially in recent months by rising prices for fuel, electricity, raw materials and the drought. There are now two additional problems: the shortage of cereals for animal feed because of the Russian invasion of Ukraine, and the haulers’ strike which is preventing their products getting to their usual markets. The lack of sunflower oil's imports from Ukraine mainly affect the food manufacturing sector.
Inflation currently running at 7.6% is a huge aggravating factor. This has been compounded by the double increase in the minimum wage of 5.2% in only five months. According to economist Javier Santacruz, "most of the jobs lost among farmers and fishermen are due to the increase in labor costs". In the same vein, economist Daniel Lacalle adds that "only 10% of the total job losses in the last 13 months can be attributed to the increase in production costs".
This previous article is focused on the livestock sector Spain: Livestock controversy adds further pressure on farmers | Nieuwsbericht | Agroberichten Buitenland.
With this rural world’s biggest demonstration ever, the protests beginning at the end of 2021 ended. They were the second part of the oned held in early 2020 which ended with the arrival of the pandemic.
Among the 19 demands of the rural world to guarantee its future are: guaranteeing profitability, a fairer strategic plan and CAP, that imports comply with current EU regulations, employment contracts that allow for the sector's intrinsic seasonality, plans to guarantee water for irrigation, reduction of electricity tariffs, investment in water works to reinforce the fight against climate change, lower taxation, support for hunting.