Increases in basic necessities, including those within the Fair Prices program,
affected the most vulnerable sectors of society the most.
The reason is that the lower-income segments spend most of their income on essential consumption and also tend to buy less in supermarket chains that joined
this mechanism with which the government intends to curb inflation.
According to a report by Ecolatina, "the poorest deciles of society not only spend a higher percentage of their income on mass consumption products, but also
tend to use department stores less
. "
The latest Household Expenditure Survey reflects that "
households in the 10% lowest income allocate only 15% of their food and beverage spending to the modern channel
(supermarket chains), while that percentage grows to 45 % in households of the 10% highest income”.
Fair prices.
ecolatin
In supermarkets or hypermarkets, the incidence of the Fair Prices program was higher than in local stores or businesses (traditional channel).
Fair Prices started in November.
Since its entry into force, the difference between the increases of some products within the agreement is not minor:
for example, in the traditional channel, water grew 10 percentage points above the modern channel;
the noodles, more than 9 points;
milk, 7 points;
yogurts, 6 points.
In a few cases, prices rose more in small businesses than in supermarkets: fresh bread -5 points in traditional ones;
flour, 7 points less;
pure oil, 6 points less;
yerba mate, 1 point less, and sugar, 8 points less.
Fair prices, consumption in supermarkets.
ecolatin
"In this sense, the performance of consumption has been more favorable in large stores.
According to data from Scentia
, in 2022 consumption in supermarkets rose 3.1% year-on-year, while in independent self-service stores it rose 0.8%
," says Ecolatina.
This difference has been increasing in recent months: in January,
supermarket sales rose 7.8% against the same month of the previous year and fell 9.1% in self-service stores.
"This dynamic is explained to a large extent by the promotions and the diversity of means of payment offered by the largest chains," highlights the Ecolatina report.
As a corollary,
the report is not very auspicious for the economy in the coming months.
"Product of the consumption pattern of families, the shortage of foreign currency and the drought, the weaknesses that Fair Prices present complicate the search to avoid a greater impact of inflation on the most vulnerable households", they affirm.
To convince the companies that manufacture food and basic products, the bait that the Government offered them was
the promise that it would provide them with the necessary dollars to import inputs.
But there are still difficulties along that line.
Santiago Romero Manoukian
, Head of Research at Ecolatina in statements to
Clarín
, stated that "these prices can be sustained as long as the Government allows companies to access the foreign exchange market, if they do not have this type of incentive, the companies will start to get out of the program.
Fernando J. Genazzini
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