Friday, January 28

Prices I: define measures for meat and follow the dispute over withholdings

After four months with stable prices, after having applied a quota to exports, meat rose 15% in butchers and 8% in supermarkets, in the week after the elections. The rise triggered a request for a meeting from Feletti to Guzmán, which led to the formation of a small table with Kulfas and Domínguez. The differences were made public: Feletti He spoke of raising retentions, and Kulfas considered that he had an “attitude that is not the most appropriate.”

After the public differences and after Domínguez assured the Liaison Board that the withholdings will not be changed, the Government will take a first measure that will be announced in the coming days. It will consist of expanding the offer of popular cuts that are sold in supermarkets, and ensuring 20 thousand tons in the domestic market by mid-December, ahead of the holidays. It will be for barbecue cuts. “Nobody wants a bad social mood at the end of the year,” said an official source.

However, despite the close relationship between Feletti and Domínguez, the Ministry of Internal Trade will seek to advance in another way. Feletti spoke with Cristina Kirchner about the price issue, who recommended that she manage it with Guzmán. The technicians of the Secretariat put together a report with a simulation that reached the hands of the Minister of Economy. There it is established that taking meat withholdings from 9% to 12% and an export quota of 20% could lead to an increase in supply in the domestic market, together with credits to subsidize production. The work considers that withholdings are nominally lower than in 2015, with higher international prices.

The report adds that current consumption, at 47 kilos per capita of meat per year, the lowest of the decade, could return to 52 kilos, or else, with retentions of 15%, to 55 kilos per year, which was the average of the government of Néstor and Cristina Kirchner. The decoupling of local prices would add $ 42 million in withholding income. The plan is incompatible with that of Agriculture, which seeks to bring exports to one million tons, and have a coefficient of 25-30% of exports of what is produced. The Secretariat seeks to lower that coefficient to 20%, and not to 12% as it was until 2015.

In one of the discussions, Domínguez considered that the problem does not involve prices, but wages. In the Secretary of Commerce there are no tools to freeze the price of meat, or to raise withholdings. So far, Feletti has held meetings with the ABC consortium, the Friar refrigerator, consignees and Coto. Exporters argue that the world is short of protein, and that the local market will never be robust. Meanwhile, the secretariat receives complaints from the mayors: in butcher shops in the third cordon of the suburbs, only chicken or pork is sold. One part of the coalition believes that if action is not taken, it could lead to a food crisis.