Commodity price drop already arrives at retail

The drop in prices of raw materials began to arrive at retail, said Solomon Frames yesterday, Deputy Superintendent of inflation of the Brazilian Institute of Economics of Fundação Getúlio Vargas (Ibre-FGV), commenting on the General Price Index data-10 (PGI-10). "The prices of commodities such as soybeans, corn and wheat are falling wholesale and it begins to arrive, gradually, to retail. This cheapens the feed and, finally, the meat. "
The PGI-10 rose 0.18% in April, after a high of 0.22% in the previous month. The reduction in the pace of expansion is due to the deflation of the producer price index (IPA), which represents 60% of IGP-10 and high of 0.11% in March to fall of 0.06% in April.
In IPA, the gross raw materials fell 0.92% in April, after a low of 0.81% in March. The price of corn in grain fell 7.83% in April, after a low of 2.37% in the previous month. Soybeans, which retreated 5.53% in March, fell 5.56% in April and wheat rose from 1.52% to low loss of 1.56%.
The IPA also photographed reduction in meat prices. The pork fell 7.83% in April, compared with 2.37% drop in March. The beef, which retreated 0.06% in March, fell 0.09% in April. The price of whole chicken, after rising 3.56% in March, fell 0.60% in April.
Qazi also said that grain products are also in deceleration. In the case of baked goods and cookies, which rose 1.44% in April, after a high of 1.62% in March. The same occurred with wheat flour, high of 5.29% in March to 1.44% advance in April.
The consumer price index (CPI) rose 0.67 percent in April down from high of 0.49% in March, down by food, which rose from 1.26% to 1.4%; clothing, which had fallen 0.04% and was discharged from 0.31% in April; and health and personal care, which rose 0.61% in April, after a high of 0.58% in March. The food follows pressed by English potato (high of 13.43% in April compared to 6.72% in March), onion (21.17% compared to 14.27%) and tomatoes (15.77% compared with 8.55%).
The national construction Cost Index (INCC) rose 0.65% in April, after record high of 0.37% in March.
According to Solomon, the PGI-10 has room to slow down on the accumulated rate in 12 months on the following six collections, because the commodity price is low. In addition, vegetables and legumes, which came up, should not have more strength to continue on this trajectory in ´ coming months.
With the April result, the PGI-10 high of 7.45% accumulated in 12 months, the third next downturn. "In the second half of 2012, we had high monthly fees, turning up of 1% per month, because of the breakdown of Brazilian and American vintages. This should not be repeated this year. In addition, the monthly fees that the beginning of the year are low, "he said.