Inflation in supermarkets closes 2023 at 1.02%; lowest level since 2017

The Supermarket Price Index (IPS), calculated by the Associação Paulista de Supermercados (APAS) in partnership with the Fundação Instituto de Pesquisas Econômicas (Fipe), registered inflation of 1.20% in December, a result influenced by the increase in the food sector (1.50%). Year to date, however, the index ended with an increase of 1.02%, above what APAS estimated – inflation of 0.85% for the year.

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Within the food segment, fresh products presented the highest inflation in the month (6.33%), followed by non-alcoholic drinks (1.52%), semi-finished products (0.89%), processed products (0.80% ) and alcoholic beverages (0.74%). On the other hand, there was monthly deflation in cleaning articles (-0.44%) and hygiene and beauty articles (-0.21%).

“The IPS result for December accelerated when compared to the month of November (0.74%) and in relation to December 2022 (1.0%). In the year to date, however, the index ended with an increase of 1.02%, marginally above what APAS estimated – inflation of 0.85% in the year, which would mean the lowest level since 2017”, comments the chief economist from Apas, Felipe Queiróz.

For this year, the entity projects that inflation in supermarkets will accelerate and end the year at 4.5%. The perspective projected by the association considers factors arising from the external scenario and climate change on price behavior.

Semi-finished

The category of semi-finished products recorded the third consecutive increase in December (0.89%), although in a smaller magnitude than that observed in November. The result is the result of the strong expansion in the prices of cereals (8.39%) and poultry (4.14%), since the other categories showed deflation in the month. Although the last quarter of 2023 saw inflation in semi-finished products, in the year there was deflation of 5.90%, a result that is reflected in families' consumption baskets.

The price of pork fell, with deflation in December of 0.34%. In 2023, the drop in pork prices was 6.57%. In the opposite direction, poultry presented inflation in the month of December mainly due to end-of-year dinner purchases. The increase in price (4.14%) was due to the increase in the price per kilo of chicken (3.88%) and the price of turkey (11.45%). However, during the year, poultry prices also deflated by 6.95%.

December was also marked by inflation in the cereals subcategory (8.39%), with all the products that make it up following the same trend. During the year, inflation was high in this subcategory (10.44%), as a result of the high expansion in the price of rice (26.08%). On the other hand, the large bean harvest contributed to the product experiencing strong deflation last year, which stood at -14.41%.

Industrialized

The category of industrialized products presented inflation of 0.80% in December, which contributed to the accumulated inflation in 2023 being 1.35%. During the month, there was inflation in all subcategories that make up industrialized products. The main increases were in sweets (1.14%), baked goods (1.91%) and meat products (0.41%). Year-to-date, there were mixed signals with subcategories showing inflation and others showing deflation.

The results of industrialized products were mainly influenced by increases in the costs of production inputs derived from wheat, considering that a significant part is imported by Brazil.

In individual terms – without considering the weight it has for the indicator – the price of olive oil drew attention due to its significant growth in the year 2023: 42.65%.

Fish presented deflation in December (-0.29%), but inflation of 0.29% in the year.

“The price of hake was the only one to show deflation in the last month of 2023 and, due to its weight in the survey, it caused the month to show a price reduction”, explains Queiróz.

In natura products

In natura products had inflation of 6.33% in December; In the year, price growth was 10.32%. The monthly result was strongly influenced by the inflation of tubers (16.23%) and vegetables (7.22%); In the annual assessment, fruits (10.61%), vegetables (13.23%) and vegetables (26.40%) stand out as vectors of price growth.

Within the fruit subcategory, the biggest contribution to monthly inflation came from the 15.03% increase in oranges and bananas (2.15%); for annual inflation, orange (23.97%), apple (6.14%) and seasonal fruit (13.36%).

In the vegetables subcategory, monthly inflation was influenced by the increase in the price of tomatoes (8.19%), zucchini (10.99%) and cassava (6.24%); Carrots (47.95%) and zucchini (46.56%) are the main contributors to annual inflation.

When analyzing tubers, monthly inflation occurred in all products except garlic, which showed deflation of 0.25%. The highlight of the increase was potatoes, which increased by 36.29%. The annual assessment also infers that potatoes had the main contribution to inflation in the subcategory, with an increase of 13.15%.

The monthly inflation of vegetables was mainly impacted by the increase in the prices of lettuce (1.73%), coriander (2.47%) and parsley/chives (0.16%). In the annual analysis, all vegetables showed an increase in prices, including lettuce (26.68%), coriander (26.87%) and kale (30.61%).

Drinks

Both subcategories of drinks showed inflation in December – non-alcoholic drinks (1.52%) and alcoholic drinks (0.74%) – largely influenced by the end of year festivities. The same inflationary movement was observed in both subcategories in the annual comparison.

Within non-alcoholic drinks, in December, all products showed inflation, except for soy-based drinks, which had deflation of 0.13%. The highlight was the 1.86% inflation in soft drinks. In the annual comparison, all categories showed price increases in 2023, again with emphasis on soft drinks (6.06%) and soft drink powder (5.36%).

Inflation for alcoholic beverages in December was strongly influenced by the 1.0% increase in beer prices; in the annual comparison, the prices of beer (7.85%) and wine (2.73%) were the main drivers of expansion.

Cleaning items and hygiene and beauty products

Cleaning articles and hygiene and beauty products showed monthly deflation of 0.44% and 0.21%, respectively. Powdered soap was the biggest contributor to the monthly price reduction of cleaning items, with a drop of 1.83%. The deflation of hygiene and beauty items resulted from the 0.54% drop in the price of soaps, 1.47% in disposable diapers and 0.17% in deodorants.

In the annual assessment, cleaning articles also showed deflation (-0.37%), largely influenced by the 6.58% drop in washing powder. On the other hand, hygiene and beauty articles presented annual inflation of 3.93%, with the main drivers being the 5.56% increase in the price of toilet paper, 2.45% in disposable diapers and 1.57% in soap. .