The most expensive San Isidro donuts in history: its ingredients have risen 27% in the last year
Food prices have increased by 12.9% in the last year and are the products that are pulling inflation the most. Specifically, sugar is what has risen the most (49.6%), followed by butter (+31.2%), milk (27.7% whole and 27.5% skimmed) , sauces and condiments (26.3%) and baby food (23.3%).
With these increases, prepare this year the San Isidro donuts, the typical dessert at this time in Madrid, which is made from sugar, butter, milk, olive oil (which has risen by 22.2%), flour ( +14.7%), eggs (+15.8%) and yeast, will be 27% more expensive this year than in 2022.
Although food inflation eased in April to 12.9% from the 16.5% it registered in March, this does not mean that supermarket prices have fallen, but rather that the difference compared to prices last year a year is less. Although this slowdown is positive, it must be taken into account that inflation accumulates year after year. In fact, food is 29.7% more expensive today in Spain than before the pandemic.
According to the calculation of CPI variations from the National Institute of Statistics, between April 2019 and April 2023, food and non-alcoholic beverages are the group of consumer goods that have registered the highest price increase in the last four years.
Hotels, cafes and restaurants are in second place, as they are now 15.3% more expensive than before the covid hit; followed by transport, which has risen 13.6% since 2019 and household goods, which is now 13.2% more expensive. Alcoholic beverages and tobacco have risen 12.7% since then; housing has become more expensive by 8.9%; clothing and footwear and leisure and culture have risen by 5.7%; medicine, 3.8%, and education, 3.5%. The only thing that has dropped compared to the pre-pandemic level is communications, which are now 1.6% cheaper.
Accumulated inflation since then in the country stands at an average of 14.5%, which means that food has become twice as expensive as the average for the products and services we consume, impacted by the energy crisis, the rise in prices fertilizers, the contraction in the supply of raw materials and, now, the drought.
Even if year-on-year food inflation has eased in April, there is a risk that it will remain at high levels for quite some time. “Food maintains upward pressures, despite the recent moderation in the prices of agricultural raw materials in international markets, due to the effects of the drought,” said the Independent Authority for Fiscal Responsibility (AIReF) this week. which provides that if inflation in the supermarket persists, the Government will extend the VAT cut.
“It is important to note that, in addition to the prices of energy products, there is an added factor of uncertainty in inflation forecasts, which is the impact of the drought on food prices,” Funcas warned yesterday along the same lines.
This body forecasts that fresh food will continue to rise in price month by month throughout the year, with which its year-on-year rate of increase would go in crescendo from the 8.8% registered in April, until the average increase for the year would remain at 10%. Regarding processed foods, they believe that they will rise less month by month than fresh ones, but nevertheless their distance from last year's prices will be higher, 13.5% on average.
In addition to the record increases in food, the INE published yesterday that the rental price has registered the highest rise in April since 2009, although it stands at only 2% year-on-year. In any case, it is the largest increase in fourteen years and, due to the weight it represents in family income, it has a significant impact on the income that remains available for consumption.