Shortages and price controls are making it impossible to shop for groceries in Argentina

You say tomato, Argentina says tomorrow.
You say tomato, Argentina says tomorrow.
Image: AP Photo/Victor R. Caivano
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These days in Argentina, buying food is more complicated than a standard trip to the supermarket or corner store.

Argentines have been asked to limit their consumption of tomatoes—a staple in the local, Italian-influenced diet—until September due to shortages, or “for seasonal reasons, involving crop rotations in the farms,” according to a statement from the Office of Domestic Commerce.

The country already has been dealing with the fallout from one of the worst-ever wheat harvests, which has caused a flour shortage and spurred bread prices to rocket. To mitigate the inflationary shock, Domestic Trade Secretary Guillermo Moreno and the president of the Industrial Bread Federation of Buenos Aires province established a locked price of AR $10 ($1.83) for a kilo of bread until 10 a.m., which bakeries are still slowly adopting and only apply to a fraction of the goods. In Buenos Aires, early birds patron local bakeries in hopes of snagging the limited price-frozen loaves, which after 10 a.m. rise to AR $18 ($3.30). The government also has paused wheat exports to push farmers and exporters to sell locally.

The price controls on bread play into the federal government’s larger fight to curb inflation, which includes numerous other price controls—500, in fact. The government states consumer prices rose 10.5% in one year through last April. Private economists, however, place have placed the inflation rate for that same period at an increase of 24%.

The initial effort to reel in inflation via price controls was in February when a freeze was declared on all products sold in supermarkets and appliance stores. While those categories of goods did not budge in price, everything else increased.

The government instead reevaluated and decided to selectively freeze goods. The most recent round of freezes were effective as of June 1 and are scheduled to last until October. A total of 500 products ranging from cooking oil to gelatin mix are locked in at a set price in the country’s major supermarkets, including Wal-Mart, Carrefour and Jumbo.

Cooking oils are among the many goods that carry fixed prices in Argentina these days.
Cooking oils are among the many goods that carry fixed prices in Argentina these days.
Image: AP Photo/Natacha Pisarenko

Supermarket executives worked with the government to establish the list, which has come under criticism from consumer groups for its sloppiness. Prices also have been found to vary as much as 300% between retailers, and that the list of products was not determined with the needs of the average consumer in mind. While some foodstuffs like certain cuts of meat are included, the list includes what many consider a disproportionate bevy of non-necessities while basics like dairy products are more overlooked. For example, the list includes only one type of milk plus, a powder milk product, but about 15 wines and a number skincare products, including as many as 10 hair removal creams. A full list of products, distributed for consumers, can be found here (Link in Spanish).

Price freezes have rendered the supermarket even more of a maze than before. Price-fixed products, often discreetly denoted with a small snowflake tag alongside the price—as well as in many cases, a notice limiting the number of price-frozen units one family can purchase—are arranged alongside those that aren’t. The differences between the products, save for the listed price, are sometimes close to indistinguishable. Supermarket executives and food manufacturers are compensating for being locked in on prices for certain products by launching slight variations of the price-frozen product, such as a 310g can instead of 300g, or the exact milk product plus a fortifying vitamin, then pricing as seen fit.

The first installment item-specific price controls were scheduled for a period of 60 days, then extended to four months. The latest and lengthiest of the freezes persists through October, when the highly anticipated midterm elections take place. The timing is an obvious strategy to most everyone, and while penny-pinching Argentines are seeking to save by shopping price-frozen products, some question whether the freezes are widespread and effective enough to make a difference.