The Undersecretary of Consumer Defense and Commercial Loyalty is planning to conduct new studies on the value chains of essential foods for family consumption, such as oil, rice, and fruits and vegetables. This analysis will help determine the competitive advantage of companies in the food industry and provide consumers with a better understanding of where prices come from.
The value chain is a critical aspect of business operations that involves the sequence of activities that add value to a product or service. By monitoring these activities, the Undersecretariat can gain insights into how companies create and develop their products, which allows them to sell them at a higher price. This information is also useful for consumers who want to make informed purchasing decisions.
Recent reports have shown that food prices have been increasing above general inflation in Argentina. In December 2023, agri-food prices multiplied by 3.5 times from the field to the shelf, according to a report from the Chamber of Medium Enterprises (CAME). The report also highlighted the impact taxes play in shaping prices, with 25% of the final price of food being made up of taxes according to the Agricultural Foundation for the Development of Argentina (FADA).
The increases in food prices have had a significant impact on families’ budgets, especially those with lower incomes who allocate a greater percentage of their income to purchasing these products. Producers have also been affected, as they received only $3.5 for every $1 they received in December 2023 from consumers who paid inflated prices for their products.
To address this issue, the Undersecretariat plans to begin by analyzing the value chain of essential foods for family consumption. By understanding how these products are produced and marketed, consumers can make more informed purchasing decisions and producers can adjust their pricing strategies accordingly.