One of the most notable examples is the olive oil industry. Poor olive harvests over the past two seasons have caused a historic surge in olive oil prices, contributing significantly to food inflation. The shortage of olives has also resulted in reduced demand for labor in harvesting and processing activities, further exacerbating the sector’s challenges.

Between 2021 and 2023, employment in agriculture has declined by 6.2%, equivalent to a loss of 51,000 jobs. This decline stands in stark contrast to other productive sectors in Spain, which have collectively experienced a 7.4% increase in employment during the same period. The agricultural workforce has shrunk in eleven autonomous communities, with Andalusia and Catalonia being among the hardest hit regions.

Andalusia, a region where agriculture constitutes more than 30% of national agricultural employment, has seen a loss of approximately 35,500 workers, representing a 13% reduction. Similar trends have been observed in Castilla-La Mancha and Extremadura, the latter being the second-largest contributor to agricultural employment in Spain, where the workforce has declined by 9%. In Catalonia, where agricultural employment has fallen by 12.1%, the drought has particularly impacted the wine and cava-producing areas of Penedès and Priorat. Wineries in these regions have reported declining sales due to reduced production, directly linked to water scarcity.

Conversely, Murcia and Galicia have bucked the trend, reporting a more than 4% increase in agricultural employment during the same period. This growth highlights the variability of the drought’s impact across Spain, with some regions managing to sustain or even expand agricultural activities.

The drought has also left its mark on Spain’s agri-food exports. While the value of exports reached over 67 billion euros in 2023, an 18% increase compared to 2021, this growth is primarily attributed to rising prices rather than increased export volumes. In fact, the total volume of exports has decreased by 14%, with most autonomous communities experiencing declines. Notable exceptions include the Basque Country, the Balearic Islands, and Galicia, which have managed to maintain or increase their export volumes. However, regions like Andalusia and Aragon, where agri-food exports represent significant portions of their total export value, have seen declines exceeding 20%.

The reduction in food production is widespread across Spain, with extensive crops such as grasslands among the most affected. Cereal production has faced particularly steep declines, with barley yields dropping by more than 50% compared to the 2017-2021 average. Wheat and corn production have also suffered, with reductions of over 40% and nearly 30%, respectively. These decreases have directly contributed to rising food prices, further straining household budgets.

Fruit production has not been spared either, with rainfall shortages and irrigation restrictions significantly impacting harvests. The tangerine harvest has fallen by approximately 15% compared to the 2017-2021 average, while orange production has declined by over 25%. Olive groves, despite showing some improvement in the current season, remain below average production levels.

The ripple effects of the drought extend beyond agriculture, influencing the broader socioeconomic landscape. Reduced agricultural output has implications for food security, regional economies, and employment. The challenges faced by the sector highlight the critical need for sustainable water management practices and investment in climate-resilient agricultural systems to mitigate the effects of future droughts.

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