In the middle of a mobilization of farmers in Madrid where hundreds of tractors were mobilized in a new protest by the agricultural sector due to the escalation of costs that puts the viability of farms at risk in the middle of the campaign, the increase in diesel prices has positioned itself as the main trigger of the unrest, shooting up to 40% in just one week.
Given this, farmers warn of a general increase in costs, and denounce that the fertilizer price has increased between 35% and 40%, going from around 300 euros to around 500 per ton. Added to this increase in price is the rise in agricultural diesel, which in just one week has gone from 0.85 to 1.80 euros per liter, which represents an annual extra cost of between 8,000 and 10,000 euros per farm.
The sector demands urgent measures from the Government
Francisco José García, president of the Young Farmers Association (ASAJA) of Madrid, has demanded direct intervention by the Government to contain prices, in an interview for ‘COPE’. “I don’t understand why, if we pay an SMI, they don’t put a price cap on diesel, or that they take away the 21% VAT after the increase,” he noted, emphasizing that fiscal or regulatory measures be proposed to cushion the impact of energy costs on the sector.
Furthermore, this discomfort is aggravated by the perception that the price increase does not respond only to market factors, and the sector points to possible “speculative practices” of oil operators. In this sense, farmers emphasize that Spain does not directly depend on conflict zones for its supply and has strategic reserves for about 90 days, which, in their opinion, questions the increases.
But the rise in energy prices not only affects the countryside, but extends to the entire economy. According to the latest oil bulletin of the European Union, “the average price of diesel has increased by 14.1% in the last week, reaching 1.6 euros per liter, while gasoline has risen by 7.7%, also reaching 1.6 euros,” according to COPE.
“Filling a tank costs about 9.5 euros more than a year ago”
An increase that has an immediate impact on consumers’ pockets, since “filling an average 55-liter tank of diesel now costs 90.47 euros, about 9.5 euros more than a year ago,” denounces Francisco José. While in the case of gasoline, the cost is around 88 euros, 3.25 euros more than in the same period of the previous year.
However, the outlook points to further increases. With a barrel of oil above $100, experts expect this trend to continue in the coming weeks. Meanwhile, from the economic perspective, drivers are recommended to look for more competitive service stations to mitigate the impact.
For its part, in the agricultural sector, the alternatives are limited, since the dependence on diesel for machinery and transportation directly aggravates the production costs of the sector.