A surge in the price of olive oil in top grower Spain has increased the cost of making a traditional paella to its highest in five months.
Bloomberg’s monthly index, which calculates how much Spanish households need to spend on ingredients to make the Mediterranean rice dish, jumped 18.3% in August from a year ago, accelerating from a 15% rise the previous month.
This compares with an uptick in the rate of headline inflation to 2.4% and a slight slowdown in the pace of overall food price increases to 10.5%.
Olive oil led the spike, shooting up 53% in August from a year ago as Spain reels from devastating droughts. Prices have risen so much that thieves are targeting olive oil mills in the south of the country, and supermarkets have started to place security tags on bottles.
While inflation in Spain has slowed sharply from double-digit levels last year, the cost of making paella is a reminder of lingering price pressures on everyday items that continue to hit consumers in the euro zone’s fourth-biggest economy.
The European Commission forecasts year-end inflation of 3.6% in Spain, one of the lowest rates among major economies in the region and below the euro area’s average.
