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will extend the program until August with new conditions

will extend the program until August with new conditions

This Saturday May 20th would begin to govern new stage of Fair Pricesthe program implemented by the Minister of Economy, Sergio Massa, to try to moderate the rises in food. After the escalation of prices after the currency run, the Secretary of Commerce defined new conditions and extended the program until August, the month in which the primary elections will be held, according to the reading they do in the private sector. Sources of Commerce assure that already agreed with 90 companiesof the more than 120 that make up the program, and assure that they work for make a special basket to reach local businesses.

The monthly limit of increases that will be allowed for most of the products that are on the shelves of supermarkets will go from 3.2% to 5% monthly. In February, when the agreement was announced at a large event at the Kirchner Cultural Center, the guideline for a 3.2% increase had been set. However, with inflation that escalated in the last month to 8.4% monthlyalready in double digits in food, as of May that limit will be modified.

What the Secretary of Commerce communicated to the companies is that they will be allowed to increase 3.2% at the beginning of the monthas initially planned until June, and from the 20th of each month another 1.8%, which gives 5% per month.

Meanwhile, there will also be changes for the almost 2000 products that froze their price in February and they had to keep it until June. For that basket, you will be allowed an increase of 3.8% monthlywhich would also start this Saturday, May 20.

Fair Prices was the program that Massa launched to replace Precios Cuidados, with a much larger basket of products and with more items than food, given that the previous program, which was about to celebrate its 10th anniversary, had been established with an inflation that was not even a third of the current one.

The first stage was launched in November and was scheduled to be completed in March. However, with inflation not showing a drop of 1 point every 45 days, as Massa had proposed, its relaunch was brought forward to the first days of February. Now something similar will happen. In the February renewal, the duration was going to be until July. Yet now As of May 20, it will have new conditions, which will be extended in June and July, so changes are expected for August.

In any case, the modifications to the Fair Prices plan for the moment were communicated by the Secretary of Commerce, which heads Matthias Tombolini, to food and supermarkets and hypermarkets, where the controls will govern. However, with just 24 hours to go until the new guidelines go into effect, there are doubts in the sector. Some food companies wonder if supermarkets will enable shipments of the new listings. While some supermarkets fear the lists of one of the most important companies in the sector, which is in a “rebellious” situation to comply with the guidelines, according to sources in the food sector.

“The final details on the exceptions to increases in some specific products, such as yerba, must be resolved this Friday,” said a source from Copal, an entity that groups food companies. In addition, another of the doubts of the market is how the new conditions will materialize, given that at the moment they were communicated by telephone or in person to the executives of the food companies. It is not clear if it will be an addendum to the previous Fair Prices or a new one. The interest of Commerce in having adherence to the program in writing is then to be able to intimidate or fine in cases of non-compliance. From a firm in the sector they complained that this time there was no “negotiation”, but that it was “unilateral”.

“Costs rise much more than 3% and the joint ventures that we had closed in March are reopening,” they commented from a multinational. “The carrotwhich was access to the official dollar, is no longer so, because imports come in drops due to the lack of dollars,” they added from another company.

On the other hand, in Commerce they assure that the idea of ​​arriving with regulated prices to local businesses. Could be a basket of some 50 essential products, although from the industry there is little optimism that it will advance. “It is difficult to implement, because it is impossible to regulate the price of sale to the public of all stores, kiosks or Chinese, as a producer you cannot take charge of the price that they are going to sell,” they assured from a food company.

Food prices are in a worrisome dynamic for the Government. In April they went up 10.1%according to INDEC, a double-digit monthly increase for the first time since 2002. So far in May, there is no slowdown, according to private consultancies: Only in the second week of May, food climbed 3.6%, and so far in May, 4.8%, according to the LCG consultancy, only for the first fortnight of the month.

This dynamic of free prices in local stores, and regulated in large chains, changed the way of consumption. In April, consumption fell 0.3%. However, divided by channel, the fall was 8.7% in supermarkets, while in supermarkets it had a year-on-year rise of 9.4%according to the latest report from the consulting firm Scentia.

Source: Ambito

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