A few years ago, I was startled, yes startled, at just how quickly grocery prices were rising in the supermarket. In the space of a few months in 2007 a one litre tetrabrik of full fat milk rocketed from around 50 cents a litre up to about 75 cents a litre. That´s a 50% increase. As a familia numerosa we have an awful lot of small people milling about in our house and because of that we get through a tremendous amount of milk; two and half to three litres a day. They need the calcium to build strong little bones and grow nice healthy teeth you see.
As the price of milk went up, so it followed that every other product that has milk as a constituent ingredient also rose. We get through a pack of 8 yogurts every day, a lot of cheese gets eaten, I´m partial to a square or two of chocolate now and again; so it didn´t take long for us to feel the pinch. The price hikes weren’t just limited to dairy products. Poultry, meats, vegetables - just about any product that was derived from farming and agriculture seemed to be rising in price at a phenomenal rate.
In an attempt to halt the spiraling cost of the weekly shop I started making regular forays into the Lidl supermarket close to where I work. What can I say? It was the most thoroughly miserable shopping experience of my life. I´ve often thought about contacting the Lidl head office in Neckarsulm, Germany to see if they´d be interested in publishing a guide I´ve prepared for the uninitiated Lidl shopper, it’s full of handy tips:
- If arriving at Lidl by car, try and secure a parking spot well away from the groups of straggly-haired winos that set up camp on our premises each morning. Failure to do so may result in unextinguished cigarette butts burning away on your car bonnet and empty beer cans placed under your tyres. It will also necessitate at least one heated exchange to explain that you don´t have any cigarettes and that you need the euro in your trouser pocket to get a trolley.
- As part of the Lidl shopping experience it is customary that all our patrons, before entering the store, have lucky heather shoved up their nostrils. They will also be invited to buy a newspaper they´ve never heard of that is mysteriously kept in a sealed transparent plastic bag by the vendor.
- Upon entering the store, avoid eye contact at all costs with our highly trained, black ops, security personnel. A nod or a smile in their direction will immediately identify you to them as a serial shoplifter and you will be subject to a cavity search on departure.
- In order to prolong your enjoyment of Lidl, our staff are trained to close checkouts as soon as there are more than 5 shoppers in the store at any one time. We pride ourselves on queue length and aim to make a 2 minute stop for a packet of biscuits take up the best part of your afternoon.
- Why not try Fortuna Bread? – exclusive to Lidl. When he´s not “out back”, our chain-smoking baker with the nicotine stained fingers bakes fresh bread, on site, with his unique carcinogenic dough. Mmmmm.
- Finished shopping? Let a gaggle of unstable and potentially violent strangers escort you back to your car with your purchases. Your peculiar team of little helpers will load your groceries, return your trolley for you and even relieve you of all that annoying spare change rattling about in your pocket.
The express "10 items or less" checkout in Lidl.
Alright, perhaps I´m being a bit harsh. This was a Lidl store located on the outskirts of an industrial estate in Madrid, next to an INEM office. I´ve subsequently visited Lidl supermarkets in Sweden and closer to home in Guadalajara and they´re really not so bad at all. It was unfortunate that I picked what I truly hope is their least appealing store for my first Lidl experience.
I must sound like one of those supermarket snobs. I´m really not you know. I hadn´t spent my life consciously avoiding Lidl, I´d just never had one near home and as a consequence shopping there had never even occurred to me. What´s more I´m in a fairly serious relationship with Alcampo; I have their store card which I think constitutes "commitment", and I spend about 700€ a month there (300€ of which is in their petrol station) but I wouldn´t say I´m entirely monogamous. I’m still young and I do fool around a bit with Mercadona, and as long as no-one gets hurt I don’t see it as a problem.
I do know people that will only shop in El Corte Ingles. Not because it is convenient or cheap, but because it isn´t cheap. I know, I know. I can't comprehend it either. It really is bizarre. There´s evidently an entire demographic out there that´s operating at completely the opposite end of the grocery shopping spectrum to me. I´d love to follow these people around on their weekly shop; “That´s a bit pricey love, pop that in the trolley.” And just in case any of you doubt the existence of people that actually want to pay more for something than they need to, consider the case of an obscure continental lager, the brewing rights to which Whitbread purchased from the Artois Brewery in the late seventies. Stella Artois back then was a virtually unheard of regional Belgian beer and it really wasn´t selling in the UK. Whitbread called in the ad agencies, the PR firms, the marketing guys and those think tanks that study the science of shopping patterns. Instead of looking at ways to cut costs and produce their lager more competitively, they did the exact opposite. They put the price up, launched a huge television ad campaign and sold it as “Reassuringly Expensive”. Sales exploded, Stella Artois spent the next two decades as the UK´s best-selling lager.
To get back to the point of today´s post, I started to investigate what was causing such acute increases in food prices. I was already aware that the price of oil was marching upward. We do 4 or 5000km a month in our car, plus our hot water and heating runs on gasoil B, so we´re very much at the sharp end of oil price fluctuations. But what I couldn´t fathom out was why a hike in the oil price should have such a detrimental effect on the price of farm produce. I could accept it cost a few euros extra to transport goods to the supermarket and eventually that cost has to be passed on to the consumer, but surely transport costs constituted just a fraction of the overall cost of production.
I wasn´t the only one watching prices with dismay. FACUA, the Spanish consumers association was also monitoring the situation. In fact they became so concerned when milk prices rose 12.5% in just 4 weeks that they asked the Comisión Nacional de Competencia to investigate the possible existence of a price-fixing cartel.
Daisy - she resented accusations of price-fixing.
I began to take a bit of an interest in how food is produced and how cattle are raised. I could say that crop husbandry became a passion, but i won´t, because it didn´t. My prior knowledge of agricultural techniques was limited to what I´d learnt in primary school as a nine year old and really all I could recall were some foggy details about crop rotation and strip farming in the middle ages. It was genuinely an eye-opener to discover just how many petrochemicals are involved in 21st century farming.
I´d (wrongly) assumed that the gas and oil costs associated with agriculture were mainly due to trundling farm machinery about; tractors, harvesters, grain trucks. But no, that only constitutes about 30% of the total. By far the largest proportion of energy goes into manufacturing fertilisers which are derived from combining nitrogen with the hydrogen in natural gas to produce ammonia. Even more petrochemicals are employed in the manufacture of pesticides and herbicides. Finally there are the energy costs associated with milling, grinding, packaging and ultimately transportation. With all that in mind we can start to see why it costs so much to grow crops during an oil spike, and why the cost of cereal fed livestock is also hugely affected.
Have a good weekend!