2024-01-05 08:30:00
The highlights that multiplied from the so-called post-ballot honesty and the release of post-devaluation prices gender panic among businessmenwho confirmed a scenario of abrupt drop in consumptioncombined with a increase in production costswhich might be the prelude to an inflationary spiral and one loss of competitiveness of national products. With the validity of the Decree of Necessity and Urgency (BOTTOM) of the president Javier Mileywhich deregulated the economy, some private sector actors began to show a uncontrolled behaviorwhich even imposed dollarized prices in areas such as healthcare.
“Consumption projections for this year are a disaster”confessed a source from the manufacturing sector, linked to the Coordinator of Food Products Industries (COPAL), which presides Daniel Funes from Rioja, also head of the Argentine Industrial Union (UIA). According to the numbers managed by a so-called large company in that field, there are three consumption scenarios on those who set up their businesses, all bad: “The most optimistic, with a 10% drop; and, the most pessimistic, with a drop of 30%”.
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The companies of food sector they remarked prices in a 30% average last December, according to private measurements, although they did of disparate way among members of the sector. Not all of them can sustain skyrocketing inflation given the collapse of sales on shelves, especially in items that are not essential. “All prices are honest, except salaries. Therefore, consumption capacity falls,” warned another COPAL source, consulted by PROFILE.
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A member of the small table of the UIA admitted that, in his company, the combination of Fall in consumption and lack of imported inputs paralyzed some production chains from its factory, with products that it no longer offers to the market. “Have suppliers that do not ship me and that means that there is already lines that I cannot manufacture. The more time goes by without being able to spin something, the more product lines I won’t manufacture,” he lamented.
The problem will have inevitable consequences, even if the payment of the stock resolved immediately: “If I unlock it today, I will have to wait two months for the product to arrive.”. There are factories that decided to keep staff, pending a resolution, despite a greater idle installed capacity. Others they began to get rid of workersas far as he might know PROFILE.
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Ayer, the second auction of series 1 of the bond to pay the import debt offered by the Central Bank (BOPREAL), Had his second misstep, with only USD 57 million offers awarded. So far, less than 10% have chosen that alternative. “It only works for large companies, which give the bonus to their parent companies, who can wait”complained an SME businessman.
There is another alert that appears on the horizon of industrialists: “The market is not accepting price increases and demand is slowing down.”. Besides, In a few months, an offer of imported products will begin to appear. Therefore, the drop in demand will force us to look at the issue once more. of costs and adjust in some way or, if not, disappear“, stated, crudely, another industrialist, who added: “I believe that many companies are going to have a bad time. If they can hold out this year, those that remain will have to become more technical to continue existing.”
Cost inflation and price debauchery
According to the consulting firm Ecolatina, the Health sector was the one that highlighted prices the most last December, with average increases of 38%. This item goes through a major crisis in referenceswhich generated a anarchy in benefits. In a Buenos Aires sanatorium, which is controlled by a prepaid medicine company, copays are imposed in dollars for trauma surgery. The striking thing is that this extra cost is not to cover materials, but is intended to fees of a specialist doctor, who claimed up to USD 500 for a clavicle operation. “It’s what’s coming”lamented a traumatologist from a clinic in the Buenos Aires suburbs, consulted by this medium.
The cost dispersion hit logistics. According to a report from the National Technological University (UTN), in December “logistical costs were impacted by the general increase in prices, with a strong boost given by the variation in the official exchange rate (120.28%).” “Fuel had a strong impact on the increases, with an increase of 63.31%. In several areas, significant increases were recorded, such as Lubricants (70.40%), Tires (32.06%), Repairs (17.19%), Rolling Stock (4.39%), Insurance (39.05%). , Financial Cost (23.46%) and General Expenses (29.67%)”, highlighted the survey prepared for the Business Chamber of Logistics Operators (CEDOL).
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Another piece of information that showed collapse of purchasing power was the fall in private work in the construction sector. “The Construya Index (IC), which measures the evolution of the volumes sold to the private sector of construction products manufactured by the companies that comprise it, registered a monthly seasonally adjusted decrease of 14.8% and was 17.4% below December 2022. In this way, the accumulated from January to December closed 7.9% below from the same period of the previous year,” stated the report carried out by the Construya Group, which is made up of the leading companies in the sector.
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