Food is one of the basic needs that no citizen can do without, no matter how prices move. Every day, Valencians faced the obligation to fill their shopping basket, watching the cost creep higher with each cycle. A long inflationary crunch stretched for years, at times prompting the central government to cut the VAT on certain items. Today, there are signs that the target around 2% set by the European Central Bank may finally be within reach. In July, the latest regional data show the Valencian Community at an inflation rate of 2.5% and the ECB’s price-stability objective in sight.
Nevertheless, even with a tightening target in view, a quick look at the eye-catching price tags in supermarkets confirms that the cost of living remains well above pre-crisis levels. The monthly price index published by the National Statistics Institute supports this difficult reality as well.
Surging costs in plain sight
When July 2019 is used as a comparison base for a basic food basket, the most recent report shows that the cost of those products has risen by more than 43% over the past five years. In practical terms, what used to be an 80-euro shopping trip now requires around 115 euros.
Despite tax cuts on some items, price increases have persisted. The changes began with policy moves in early 2023 reducing VAT on pasta to 4% and placing several staples like milk, eggs, and fresh fruit at 0%. Yet, olive oil has captured consumer attention the most. Its VAT fell from 10% to 5% at the start of 2023 and, by the middle of the year, had dropped to 0% in many cases, coinciding with ongoing concerns over inflation.
The steep climb in context
Data from the National Statistics Institute shows olive oil as the item that most noticeably strained Valencian households when comparing 2019 to today. The value of this oil has on average surged by as much as 134%. A typical example: a litre that cost around three euros five years ago can now easily exceed seven euros in current purchases.
Oil is not alone in this trend. Sugar, fresh fruit, mutton, and eggs have also seen significant increases, while staples like fish, legumes, fresh vegetables, and bread grew at more moderate paces. Bread remains a sensitive item given the global rise in wheat costs driven by early Ukraine-related disruptions. Still, the modest gains in these other staples have provided some relief to households.
In contrast, fish prices rose less aggressively, even though it did not benefit from the VAT-cut treatment that other items did.
Three products have fallen in price since 2023, and four others rose by less than 2%
Recent figures show some relief in the inflation picture. In the latest year, three items in the basic basket have declined in price relative to July 2023, including dairy products such as yogurt and cheese, cereals, and milk. Other staples like bread, fish, eggs, and vegetables have seen increases stay below the 2% threshold over the past twelve months. On the flip side, the already mentioned olive oil rose again by a double-digit percentage, while lamb meat increased roughly 10%.
Recent containment efforts
In some categories, inflationary pressures have softened in the most recent period. A year-over-year look at the basket reveals price declines in dairy products (-0.2%), cereals (-0.7%), and milk (-3%). Meanwhile, staples such as bread, fish, eggs, and vegetables rose but still stayed under a 2% annual increase. The standout exception remains olive oil, which climbed nearly 29%, and lamb meat, up about 10% compared with the summer of 2023.
On the other hand, fish prices, despite not benefiting from VAT reductions, and other items like pork and legumes have shown relative resilience, indicating a mixed inflation landscape across food groups.
Inflation trend and regional context
According to a government analysis summarised by the Central Bank, the Valencian Community accumulated a 19.1% inflation over the last five years, a figure reflecting pandemic disruption plus energy and food price pressures stemming from global events. The report also notes that national inflation over the same period sits close to 18.9%.
The study observes that regional differences stem from household consumption patterns. Regions with higher food and energy shares, such as Castile-La Mancha, show greater inflation pressure, whereas Madrid experiences more impact from services and public transport costs. Wage levels also factor into purchasing power, explaining why some areas feel the pinch more acutely than others.
These dynamics illustrate how inflation is not uniform across the country, with regional baskets shaping the different outcomes observed today. Overall, the situation underscores the ongoing tension between policy measures intended to cool inflation and the stubborn persistence of rising food prices in households across the Valencian Community.
Source attribution: Central Bank of Spain analysis (June 2024) and INE price indices. [Citations provided for context and verification.]