Companies, supermarkets and the Government itself agree that the prices of food and drinks were flattened in April. They celebrate in the official offices. The fall in consumption is so strong – March data from the consulting firm Scentia revealed a contraction in volumes of 7.5% year-on-year – that not even promotions are able to drive demand, highly affected by the fall in real wages in a context of rearrangement of relative prices. Faced with this scenario, food companies no longer have room to continue increasing their prices and in many cases there have been decreases in the last month, acknowledged the sources consulted.
On the other hand, since the Government liberalized food imports – shortening payment terms and granting tax benefits – supermarkets activated their commercial efforts to evaluate purchasing some categories of products abroad that could have competitive prices. More than a month has passed since the measure was made official, and many chains have already purchased some foods from abroad that they were not marketing and they appeared on the shelves.
“We are bringing canned vegetables, fish, noodles and some cookies from Paraguay and Brazil. Now there is a very large food fair coming up in Brazil and several commercials from the sector are attending,” they stated from a supermarket. And they added: “It gives us a tool that we did not have to discuss the price locally.”
Food companies no longer have room to continue increasing their prices and in many cases there have been decreases in the last month, acknowledged the sources consulted.
The price data managed by the Ministry of Commerce from the Statistical Price System (SEPA) indicated, until this Tuesday, that the average increase in the food basket in large chains is around 5%, half of what they increased during March. Last month, Indec reflected a general inflation of 11% and an increase of 10.5% in the “food and non-alcoholic beverages” category. “This month it dropped by half. Although we are concerned about some prices, such as bread, they have now begun to drop. They are adapting, they are converging,” said a Government source, hopefully.
The Commerce team, led by Pablo Lavigne, has been observing with concern some cases such as that of Bimbo, leader in the bakery market, which has accumulated strong increases since December and which markets its products at much more expensive prices in dollars than in neighboring countries. In fact, in a tour that the secretary made to a branch of a supermarket chain weeks ago, he was surprised by the value of the 500-gram package of Artesano brand bread, manufactured by Bimbo. “It costs almost USD 6, compared to USD 3 in Uruguay. “We are evaluating importing it because it is brought frozen and has a shelf life of 12 days,” they said on the network.
There was also annoyance about the increases in soft drinks, and with beer manufacturers, but the Government recognizes that “now the companies lowered some prices and launched promotions.” In the case of Quilmes, it announced the freezing of the price of its returnable liter bottle for three months (Quilmes Pact). Coca Cola, for its part, reduced the value of some of its containers due to the elimination of commercial actions that the Minister of Economy, Luis Caputo, questioned (2nd to 70%, for example). In AMBA, for example, the 1.75 liter bottle can be found in chains and stores for 1,200 pesos.
According to the data arising from the SEPA system, to which he had access Infobae, the average price variation of the last 30 days of the basket of food (with fresh), drinks, cosmetics and toiletries and hygiene was 6%, versus 11.2% for the same period last month and 16.7% for February. Without fresh ones, the increase was 5.6%, compared to 12.4% in March. And if only food and beverages are considered, without fresh products, the average increase, according to the official statistical system, reached 5.3 percent. Hence the official optimism and the expectation that this month general inflation will not exceed one digit.
The list of variations in the different products in the basket analyzed reveals that, as of April 23, condoms are what has increased the most so far in April in supermarket chains (22.3%), followed by desserts and flans (15.1%) and, in third place, cheeses, with a 10.2% increase. Bread products, meanwhile, rose 5.8% and jams and sweets, 8.9%. Most foods and beverages registered moderate increases, or even showed decreases, as in the case of dry pasta, whose average price fell 2.1% in the accumulated value of the month.
“In December we had 40,000 price changes in the month. In January, 15,000. And so far in April, we have only had 240 price changes,” they stated in a chain. The reasons, already mentioned, have to do with the sharp drop in demand, which this month is around 10% in units compared to the same month last year, mass consumption analysts and the supermarkets themselves advanced. The worst item in sales continues to be household appliances, which has seen a 45% year-on-year decline, and others that are not warehouses, such as textiles, also suffer a drop of 30% or more.
