RIO DE JANEIRO, BRAZIL – One of the biggest challenges during the pandemic has been to save money on groceries. Even basic products, such as rice and beans, have gone up in price in recent months. In turn, 62% of the population saw their income decreased in the period, according to Datafolha.
The variation in values took not only Brazilians by surprise. In several regions of the world, inflation has made people redouble their care in supermarkets. However, according to Oxford University’s study with data from the World Bank, Brazil was the country where prices rose the fastest.
To get an idea, at the beginning of 2020, it was possible to find five-kilo packages of rice for R$15. In September, the same product was sold for up to R$40 in some cities. Even though the increase is not the same in all locations, inflation being so strong for everyday items worries, consumers.
Why has inflation been strong in the country?
Although the coronavirus pandemic affects Brazil the most, the inflation in food prices is not directly related. In fact, the escalation in values started last year, when the Real depreciated even more against the dollar.
Consequently, Brazilian products became cheaper for other countries. This caused food producers to favor exports more than domestic sales, which decreased the country’s supply and helped the price variation.
Moreover, other factors contributed to making the basic food basket more expensive. In 2020, some countries in Asia, such as Thailand and Vietnam, faced a serious water crisis that affected rice production and export. Thus, countries like Brazil stood out in the international market.
The big question is that the acceleration in prices was not accompanied by an increase in income – quite the contrary. A significant part of the population lost their income and even their jobs because of the pandemic, which has caused inflation to be felt with an even greater weight.
According to an article published by CNN, inflation and the pandemic may cause Brazil to go back to the Hunger Map, a UN survey. Countries enter this statistic when 5% of the population lives undernourished.
How will prices hold up in 2021?
It is still too early to determine how prices will be maintained in 2021. But given the acceleration of 2020, consumers need to stay alert.
Some foods may be readjusted or go up more slowly – not least because they have already suffered a large increase in recent months. This is the case with rice, which is responsible for several discussions in 2020.
A bag of rice, which was easily found for more than R$20, is now costing on average R$ 18.99, according to Folheto Extra. The one-kilo package can be found for R$ 3.89 at Tenda Wholesale.
If the exchange rate remains stable and there are no other events, such as a crisis in the production of some food, there is the possibility that food prices will be stable. Anyway, nowadays, researching prices is the only weapon for consumers to avoid abusive values.
Source: Tribuna de Minas