Friday, July 01, 2016

Rice, milk and corn can be the next villains of inflation

Bean took the place of tomatoes as food that''s weighing in the pockets of Brazilians. The price of the carioca, variety popular in the Southeast, climbed 54.09% until June, according to the IPCA-15 index IBGE, considered as the prior of inflation.
Last year, a box of tomatoes came to cost twice as much as in 2014. With inflation still high, many people wonder: what will be the next villain of purchases?
To try to answer, the BBC Brazil spoke with economists and specialists in agribusiness market. According to them, the items that can cause more concern in the next few weeks are the rice, milk and corn. The climate is the common factor in all the high, explain the respondents. The irregular distribution of rainfall this year has damaged the production of those crops.
In the case of rice, the storms in Rio Grande do Sul-largest producer-in April delayed the harvest and caused a drop of 15% in the year. With less supply, prices grew by 5.21% by June, according to the IPCA-15. And should continue increasing until the next harvest, beginning in 2017.
"According to our survey, in the municipality of São Paulo ranged 6.28 percent this year. And will go up significantly in the next two months, "says Vagner Martins, of the Institute of agricultural economics. It might seem that 6% is little, but the high is worrisome for an essential element of the basic basket, ponders Malik.
Milk and corn If the high double rice and beans can be fleeting, there are other longer-lasting experts considered. The maize and milk, for example, are seen as structural and hence more concern.
Corn is a major component of feed of dairy cows and registered a significant growth in 2016. Absent in the IPCA-15, one of their representatives on the gauge, the cornmeal, encareceu 13% until June. Already the milk went up 18% over the same period and approaching a level unheard of.
Respondents explain that corn is due to high demand on the international market, in which Brazil has become a major seller. In recent years, the country has accelerated the production of food, managed to export it cheaply and had great demand from buyers, which ended up bringing the values out there. The increase came to the internal market.
With expensive corn feed increases and milk producers have to shell out more to feed their cows. The high is passed on to the consumer. In addition, heavy rainfall earlier this year have damaged the grasslands and transport roads, hindering the production and decreasing offer.
Folha de S. Paulo
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