Food prices rose 11.02% in the last year

Inflation in Metropolitan Lima – a barometer with which the national future is measured – fell slightly in August to 5.58% in annual terms, according to the National Institute of Statistics and Informatics (INEI).

Although the figures reflect the downward trajectory announced by the Ministry of Economy and Finance (MEF) or the Central Reserve Bank of Peru (BCRP), it is not that prices will drop in a jiffy because there are supply shocks on food and fuel , especially lemon, onion and LPG, warns the director of Phase Consultores, Juan Carlos Odar.

The INEI reflects that, since September 2022, the Consumer Price Index (CPI) in food and non-alcoholic beverages – a technicality with which they label inflation – maintains a difference of just over double the general CPI, and reached 11.02% in the last August.

The products that became more expensive in the eighth month were lemon (+70%), vehicle LPG (+26.46%), mainland apple (+23.17%) and onion (+17.26%) (see infographic).

“When inflation goes down, prices keep going up, but at a slower speed. The offer is hit by climate threats and the international oil price,” explained Odar for La República, who believes that this year general inflation will be close to 4%.

There are no effective actions to mitigate impacts

The Grade Investigator Eduardo Zegarra He considers that the Government of Dina Boluarte does not have a clear route to counteract the damage suffered by thousands of rural producers and Peruvian families, especially those most mired in poverty or those who are in limbo.

With the technical recession in which we find ourselves and the stagnation of income, he considers that we are heading for another year where food insecurity breaks into households. At your discretion, must work on bonds compensation, since despite the fact that since last year there was a warning of a drought in the mountains not seen in four decades, “the levels of coordination have not been efficient”, to the point that Boluarte’s presidential message did not advance any plan developmental.

Big industry keeps winning

The problem is not only the lemon –adds Zegarra– but the increase in fruit, vegetables and tubers; although in this complicated scenario it is paradoxical that the wholesale prices of imported food (such as corn, soybeans and wheat) fell 11.72% since last year, but in consumer sales they have continued to rise.

“This indicates a high concentration in the food industry. When the prices of inputs rose internationally, everything was transferred to the national consumer, now that prices have fallen there is no such transmission. This has a major effect on the high accumulated inflation suffered by Peruvian households,” he warned for this medium.

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Eduardo Zegarra, Grade researcher

“Annual food inflation is at 11%, and before reached 16%. Households suffer a strong increase. Some foods went up beyond the average.”

Juan Carlos Odar, director of Phase Consultants

“When inflation goes down, prices continue to rise, but at a slower rate. Supply is hit by climate threats and international oil.”