Pasta, cold cuts and oil? Where (and when) prices fly – Libero Quotidiano

Attilio Barbieri

Inflation is also felt in the shopping cart. But the wave of price increases hitting products with a high frequency of purchase risk is only the final sting on Italian families’ wallets. According to Istat’s latest April price survey, headline inflation was 6.2%, a slight slowdown from +6.5% recorded in March. However, according to the Statistics Institute, cart prices are accelerating: from 5% in March to 6% in April. A fact that aroused the indignant reaction of some consumer associations, which point the finger at speculation. In fact, at least in our food supply chains, the exact opposite is happening. Prices are rising, but much slower than commodity prices and energy costs. As a result, a large proportion of agricultural producers and many manufacturing industries have seen their margins literally disappear. They find themselves selling at a loss. About a third of Italy’s 30,000 farms operate at zero margins. Especially those who cannot count on economies of scale. From €38 per liter last summer, the price in the milk barn has risen to 41 as a result of a supply chain agreement signed in the fall, up to 48 cents granted by Granarolo to its suppliers. But producing a liter of white food now costs many farmers 51 cents. Cheese and ready-made milk should cost more. not less.

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industrial cost

Similar letter to pasta. The industrial cost of a kilo of pasta in one year rose from one euro to one euro and 50 cents. But there are few who have managed to collect it. Spaghetti and tortiglione prices rose 14.1% on shelves, a number that infuriates consumer associations but does not reward the supply chain. Also because the increase in the price of goods entering the average shopping cart of Italian families, at least in large-scale distribution chains, is lower than the percentage that Istat calculated in its April survey. While the Statistical Institute calculates cart price increases at 6%, the research office of Federdistribuzione, the largest organization in the sector, estimates it at 3.5%. “Throughout the supply chain, there have been efforts to contain the increases and modern distribution companies, in particular, have so far absorbed a significant part of the cost increases,” explains Carlo Alberto Butarelli, Director of Libero’s Office of Studies and Relationships. From the Federdistribuzione supply chain. “To be precise, the figure is the result of increases of close to 6% on variable weight products and 2.5% on packaged products,” he adds, in an effort to contain price hikes and avoid a fall in consumption. “However, there has already been a decline,” Battarelli notes, “only in the past week has purchases fallen by 2% in value terms.” Huge amount in such a short period of time. But this trend started a few months ago. Since the beginning of the year, the cumulative value of sales in terms of value in supermarkets and hypermarkets decreased by 0.7%. Looking at the trend in sales by value and inflation data recorded in the shopping cart, broad distribution now records a decrease in volumes sold, in the agri-food sector, of more than 3%. So the reduction in consumption is already underway. But this situation cannot last long. “It’s as if a spring is being loaded into supply chains. When it does start, and is bound to happen,” concludes Federdistribuzione’s Head of Research, “there is a risk that the counters will reach substantially greater increments than those recorded so far.”

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household budgets

It is difficult to quantify the extent of the blow to families. However, prices are sure to go up even more. Also because the increase in the price of raw materials added to the explosion caused by the energy bill, it has doubled or tripled for many industries involved in the conversion and packaging phase. Shouting speculation, as many do, is not only useless, it threatens to stoke dangerous misunderstandings. Speculation exists and continues to exist, but in large markets where agricultural commodities are traded, for example, such as the Chicago Board of Trade, the world’s most important commodity exchange. Not forgetting the strong hands of the states that intervened, for example, in the buying and selling of grain. By January, before the war in Ukraine due to the Russian invasion, China had already accumulated more than half of the world’s reserves of wheat, corn and rice. The speculation started from there. And it suffered before all farmers, for example, had to buy corn at very high prices, which they had never seen before.

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