The rise in olive oil prices has pushed up the cost of signature dishes in Italy and Spain, despite the overall easing of inflation, Bloomberg reported this week.
According to the outlet’s monthly Pizza and Paella indexes, which show how much Italian and Spanish households spend to make these dishes, the cost of ingredients for pizza Margherita surged 8.2% year-on-year in September, while the cost to make paella jumped by 20.6% from a year earlier.
While headline inflation in both countries was well below these levels, at 5.6% in Italy and 3.3% in Spain, the price of a key ingredient has been on the rise. In Italy, olive oil was up 43% last month from a year earlier, while in Spain it surged in price even more – up 67% year-on-year, despite the country being the world’s largest producer and exporter of the staple.
Global olive oil prices hit record highs last month, topping $8,900 per ton and roughly doubling from last year due to extremely dry weather in the Mediterranean, home to two-thirds of the world’s olive oil production.
The drought has been hurting crops, as well as leading to the spread of pests and disease. In its September report, the US Department of Agriculture (USDA) revised its 2022-23 global olive oil output forecast down to 2.5 million tons, a quarter lower than both the previous year and the five-year average.
The European Commission also warned last week that olive oil prices would likely remain elevated for another season.
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