What Farmers Pay for Fertiliser and Fuel Is Rising Again, and the Bill Arrives With the Next Harvest
EU farm input prices rose 4.7 percent in the second quarter while what farmers were paid fell 5.8 percent. Portugal had the gentlest increase in the Union and will not be spared the result.
Food inflation in Portugal has been rising since last summer. The figures that decide what the next harvest costs suggest it is not finished, because the inputs farmers buy before they grow anything have started climbing again after a year of relative calm.
Eurostat data published on 10 September show that the average price of agricultural inputs across the European Union, meaning the goods and services consumed in farming that are not investment (energy, fertiliser, animal feed), rose 4.7 percent in the second quarter against the same period of 2025. Over the same three months the average price of agricultural output actually fell 5.8 percent. Farmers were paying more and selling for less.
Where the increase sits
Two lines dominate. Energy and lubricants rose 22 percent across the EU in the second quarter. Fertilisers and soil improvers rose 13.4 percent, and nitrogen fertilisers at one point stood 71 percent above their 2024 average.
Portugal is, for once, at the gentle end of the distribution. Portuguese input prices rose 1.2 percent, the slowest increase in the Union alongside Hungary. At the other end, Lithuania recorded a rise of 16.4 percent. That relative advantage does not insulate Portuguese shoppers, because the food on Portuguese shelves is traded across the single market and priced accordingly.
The lag is the problem
The International Monetary Fund, in a post on its blog titled on what governments should do when prices spike, makes the timing argument. When the war in the Middle East began earlier this year, the price of some fertilisers jumped by close to 50 percent. Prices have since normalised, but the spike coincided with the sowing season in many countries. Because farmers had already absorbed the higher input costs, the Fund argues, the effect on crop yields, farm incomes and food prices will keep working through the current harvest.
The Fund also flags the possibility of a stronger El Niño, or a so-called super El Niño, reviving food-security worries in vulnerable agricultural regions, and warns that any escalation in the Middle East could disrupt fertiliser and energy supply again.
Its advice to governments is unwelcome in an election-free autumn of announcements: price subsidies should ideally be avoided, on the grounds that they blunt the signal that tells producers to produce more and consumers to economise, and that they are expensive to unwind.
What Portuguese households are already seeing
Eurostat put euro area inflation at 3.2 percent in August, up from 2.9 percent in July, driven mainly by energy. Portugal's harmonised index sat at 2.6 percent, below that average. Measured on the national consumer price index, which excludes spending by non-residents and tourists, Portuguese inflation reached 3.3 percent in August, three tenths of a point above July, an acceleration explained almost entirely by the price of diesel. Core inflation was 2.6 percent, and unprocessed food eased slightly, from 3.7 percent in July to 3.4 percent.
That last number is the one to watch. Unprocessed food prices reflect what is being harvested now. The input costs described above land in what is harvested next.
