Inflation has tightened its grip across the continent since the Ukraine conflict began, hitting Alicante exporters first. While footwear and textiles watch disposable incomes shrink amid rising energy bills, farmers, especially those growing organic products, are already feeling the blunt impact of the downturn.
Data from José Vicente Andreu, president of Asaja Alicante, shows a sharp drop in demand for organic citrus and almonds in major European markets. Organic oranges and lemons fell by more than 25 percent, with Germany as the largest consumer, and certified almonds dropped by over 50 percent. The latest harvest has damaged prices to the point where there are times when there simply isn’t a market price available for certain fruits and nuts.
Many Alicante farmers have to sell organic produce through conventional channels to prevent waste, even if it means taking losses. Andreu recalls cutting 70,000 kilograms of lemons last week as the problem hit home for growers.
Boxes of organic lemons from Vega Baja show the tangible toll of the market shift. The scene underscores a wider challenge for organic farming, a sector long viewed as a niche with growth potential. The Community Organic Agriculture Committee notes the expansion since 2009, with 38,134 certified hectares in 2021, up from 11,939 in 2009. It is a three year process governed by stringent regulations that defines organic farming.
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Among the major considerations is cost. Production costs for organic crops run nearly twice those of traditional crops because organic fertilizers and other compliant products cannot be used freely, leading to lower yields and higher labor needs, according to Andreu.
Yet some of the effort has been offset by higher prices and the willingness of consumers to pay more for organic goods in exchange for environmental stewardship. Inflation has squeezed many household budgets, particularly through energy bills. German families have seen electricity and heating bills rise, with average monthly costs approaching six hundred euros, prompting cuts in other discretionary spending. This translates into tighter demand for organic products, especially citrus and almonds in Europe.
When it comes to lemons, organic prices to farmers typically range from seventy to eighty cents per fruit before the downturn, but with demand waning they have fallen to roughly the same level as conventional lemons around forty cents, a figure that barely covers costs. Many growers, seeking to stay productive on the trees, redirect fruit to traditional markets even at reduced returns.
The shrinking demand also affects almonds. Distributors did not buy organic almonds at peak prices in August, and new orders have stalled as warehouses fill up, according to Andreu.
In another vein, local players in the sector such as Villena based bio tradeis, which markets hazelnuts and derivatives, report declines in demand across Europe by about thirty percent on average. Federico Samper, a company executive, notes that organic consumption in Spain remains relatively modest at around sixty euros per person, while Central European markets already account for a larger share of distribution. The industry has spent two decades building this market.
A day laborer works at an organic citrus farm, illustrating the hands-on reality behind the numbers.
Otherwise, the sector finds itself caught between a shrinking demand and suppliers who cannot easily lower prices as costs rise. Both farmers and industry players are hopeful that inflation will ease and demand will revive, even as the market tightens in the near term.
About a quarter of the cultivated land in the region is devoted to organic production. The Community Organic Agriculture Committee reports that organic crops surpass Europe 2030 targets in many respects, covering most of the province’s useful agricultural area. Hazelnuts and almonds lead with roughly 6,909 hectares, followed by citrus at 3,893 hectares, olive groves at around 3,500 hectares, vineyards at 2,323 hectares, organic grains at 1,496 hectares, and vegetables at 720 hectares.