Inflation raged with the poorest regions of the country. Only in December, in the NEA – which includes Chaco, Corrientes, Formosa and Misiones – the prices of food rose three times more than in Capital and GBA: the 9.6% versus 3.1% in the Metropolitan Region. Meat and meat products rose 20.5% last month in the NEA versus 13.9% in Capital Y GBA.
This was happening throughout the past year and that’s why Northern provinces lead the inflationary ranking. While in Capital and GBA in 2020 inflation averaged 34.1%, with 38.1% in the NOA and the 42.2% in the NEA the rise in prices hit with greater intensity in the northern provinces. And that is explained, in the first place, because food rose to 50.1% in the NOA and 53.7% in the NEA compared to 40.9% in the Metropolitan Region, according to INDEC measurements.
It is known that the lower income sectors spend a greater proportion of their income on food purchases. Consequently, all these data anticipate a new climb of destitution and poverty in the North of Argentina. In the first half of last year, with 42.8%, the NEA led the poverty ranking by regions and with 18.2% the Great Resistance (Chaco) led by far the indigence throughout the country.
The surge in consumer prices was more intense in recent months. For example, in December, in Capital and GBA the rise in prices was 3.7% and in the NEA 5.5%. In November, 3.2% in the metropolitan region compared to 3.7% in the NEA. While the income of the northern population increased less and the NEA registers the lowest employment rate in the entire country.
All food items increased by far much more in the northern provinces than in the rest of the country. In 2020, vegetable prices rose more than 80% in both the NOA and NEA, compared to 58% in the metropolitan region. Fruit prices climbed between 74.6 and 79.1%. The same happened in the NEA with meat (+ 65.1%), bread and cereals (+ 33%), milk and dairy (+ 31.2%).
The increase in prices was particularly strong in staple foods that are taken as a reference to measure indigence.
For example, in the NEA the kilo of minced meat went from $ 206.78 in December 2019 to $ 351.78 in December 2020.
70.1% The kilo of potatoes from $ 26.86 to $ 63.77: an increase of 137.4%.
The kilogram of sugar from $ 40.71 to $ 66.89: a rise of 64.3%.
The 1.5 liters of sunflower oil rose from $ 139.77 to $ 229.66: 64.3%.
The rise in oil, fat and butter prices – with 51.7% – more than doubled the 24.1% rise in the Metropolitan Region. For example, 1.5 liter sunflower oil in Capital and GBA appears in the INDEC Report at $ 181.90 and in the NEA at $ 229.66. A difference of 26.3%. The kilogram of White rice $ 81.76 in Capital and GBA compared to $ 95.33 in the NEA.
In addition, the poorest regions allocate a higher percentage of consumer spending to the purchase of food and non-alcoholic beverages. While in Capital and GBA, this item weights in the index 23.4%, in the NOA it is 34.7% and in the NEA it is 35.3%.
Therefore, higher increases in food and beverages that have a greater impact on the consumption basket lead to a very high incidence of food spending in the North. The INDEC indicates that of the 42.2% annual inflation in the NEA, 18.53 points correspond to food and beverages. Thus, the incidence of food in the consumer basket climbs to 43.9% compared to 26.9% in the Metropolitan Region.
If regulated and seasonal prices are excluded, “core” inflation in the NEA rose to 6.6% in December and 45% annually. As happens throughout the country, due to the freezing and semi-freezing of rates and other items, the incidence of regulated prices is very low, but it anticipates that any increase in those regulated prices, such as gas, electricity, public transport, would lead to inflation more beyond 50%.