Private consultants are no longer just looking at the level of raises. They also note an acceleration in the pace of commentary, which is known in the jargon as inertia, as a result of the crisis and general uncertainty. In the first three weeks of April, according to LCG, All of the foods and drinks surveyed (around 8,000 different categories) changed in price at least once. Some have even been touched up twice, in a dynamic that has been heating up since the beginning of the year.
LCG carries out measurements from Wednesday to Wednesday in 5 major supermarket chains. In the first week, half of the product stock increased in value. In the second, another 33% had changes and in the third, 26%. So things, So far in April, Food & Beverage has amassed a 7.6% increase., a record almost identical to inflation throughout March (7.7%). The data anticipate another month with “average inflation between 7% and 8%”, says Guido Lorenzo, director of LCG.
Sebastián Menescaldi, of Eco Go, also agrees that the increases have become more acute in the last quarter, implying a “regime change” in price inertia. But clarify that previously, the increases accumulated in the first week of the month then slowed down. “Today we don’t know what the first week is, why sharp increases were recorded in all of thems,” explains the economist.
Both LCG and Eco Go measure prices in large supermarket chains. This is the marketing channel in which Fair Prices are concentrated, the program which envisages a basket of 2,000 fixed-price products until June, and a broader universe of almost 25,000, which have a monthly cap of 3.2% , as agreed with 129 manufacturers and suppliers of the mass consumer industry.
Redial acceleration coincides with a partial and limited flexibility of the programme. The Secretary of Commerce, led by massist Matías Tombolini, authorized increases of up to 6% on approximately 3,000 items at the express request of the companies. That is, up to 2.8% above the limit established as the “price path”. According to the lists that the supermarkets have received, the exemptions reach basic necessities and that are present in all commercial formats: hypermarkets, super, express and local.
As confirmed clarion, the list includes, among other things, a bottle of BC jam (Arcor), Fond Cave wine (Peñaflor), a can of Iguana blonde beer (CCU), Ayudín bleach (Clorox), Colgate Total toothpaste (Colgate Palmolive), Nieto Senetiner wine (Molinos), LS Ultra Whole Milk in sachets (Mastellone), Tang orange (Mondelez), Pampers (Procter & Gamble), Off spray (C Johnson) and Hellmann’s mayonnaise (Unilever). “This is part of the day-to-day negotiations Commerce has with companies“, justified an official source.
Chains agree that manufacturers and retailers send out new listings periodically, but the concern is wider than rebranding. “The problem is the deliveries, because suppliers channel the increases in the traditional channel (supermarkets and warehouses, for example). The gap with supermarkets is on average 15% e the prices in the supermarkets are very close to those of the wholesalerscomplained a senior industry executive. He further adds, that the gaps deepenespecially of the 2,000 items in the frozen bin, “because they deliver with an eyedropper.”
Menescaldi describes that in the current crisis context it is very difficult to predict inflation for the coming months. “We have to see what happens with the crisis,” he stressed. Eco Go expects April to end with 7% inflation. For his part and like many others, Lorenzo does not exclude that the cost of living will exceed double digits in the coming months.
The most worrying thing is the dynamics of the declines, which were accentuated with the jump in prices in dollars (calculated with liquidation, MEP and Blu), and the tightening of inventories on imports. In mass consumption, the widening price gap mainly affects shops, self-services and small regional chains, which are the channels through which low-income sectors purchase.
“When the inflationary process starts to accelerate and expectations become unanchored (as happened in the first quarter of this year), it is increasingly necessary to adjust prices more frequentlybecause nominal references become more widespread and alter the information content of the price system”, explains Santiago Romero Manoukian, of Ecolatina. He adds that “in this regime of high inflation, with increasing price indexation and contract shortening, a de-anchoring of inflation expectations is transmitted more quickly to prices”.
In the third week of April, food and beverage inflation averaged 2%. According to the LCG report, the items that have increased the most are takeaway meals (4.7%), dairy products and eggs (3.7%), sugar, honey, sweets and cocoa (2.8 %), bakery products, cereals and pasta (1.8% ), vegetables (1.6%), meat (1.2%) and fruit (1%). But in the cumulative over the last 4 weeks, the ranking of increases is led by vegetables (14.8%), baked goods, cereals and pasta (8.5%), meat (7.7%) and dairy products and eggs (6 .8%).
Inflation in March reached 7.7%, the highest record since 1991. Prices in April are not giving up. In the first 7 days of the month and after two weeks of relative calm, food and beverage prices rebounded strongly. Eco Go indicated that these sensitive household consumption categories increased by an average of 2%. In contrast to LCG, the values increased by 2.5% over the same period.
Source: Clarin
