The first quarter of a 20% increase in transportation costs which will end with adding one extra pressure on headline inflation in the coming months.

The Transportation Cost Index prepared by the Argentine Federation of Business Entities of Freight Transportation (FADEEAC) rose 9.18% in March and added 19.85% in the first quarter.

Thus, the sector is faced with increase in five percentage points above inflation. The official Consumer Price Index (CPI) data will be known next Wednesday and it is expected to be between 5.5% and 6% for the month and 15% for the quarter.

For FADEEAC, March is the monthly increase of the index highest in three and a half years“in an economic context characterized by a significant acceleration in retail and wholesale inflation,” they said in a statement.

The increase in freight transportation costs is happening in the middle of demanded by the carrier because of the difficulty they face every day to access diesel.

In the last twelve months, the transportation cost index increased by 54%. In 2021 the record is from 49%, two points below accumulated inflation.

The study, conducted by FADEEAC’s Department of Economic Studies and Costs, measures 11 items that directly affect the costs of freight transportation companies nationwide.

The increase in the index is primarily related to the 12.7% increase in fuel last month -after 10% of February-. Lubricants, on the other hand, rose 7.5% after several months without change.

Another area with strong coverage is increased labor costs, which had the effect of the second tranche of paritarias with an increase of 9.43%. The increase in Repairs items (3.92%) and General Cost (6.28%) also hit the index.

The segments that make up the index also include Insurance, with a jump of 17.6% and finance costs with 14.08%. Among the smallest rises were Tires, with 5.1%, and Rolling Stock. with 2.45%. In this case there are no increases in Tolls and Patents.

bid for fuel

After the protests of producers and transporters due to the shortage of diesel, YPF promised to increase supply to improve supply: it promises to increase available diesel by 10% compared to the same month in 2019.

The oil company reported that in the first week of April it had almost delivered 8 million liters more than plannedwhich represents 27% more than 2019 and 30% compared to last year.

AQ