Inflation has Colombian households in 'check': they can buy less and less food

The increase in inflation in Colombia, which according to the National Administrative Department of Statistics (Dane) was 8.53% last March, has affected the purchasing power of Colombians in recent times. With the prices of many foods skyrocketing, it is becoming increasingly difficult to buy the same amount of products as in previous periods.

According to the bank's official reports on the Consumer Price Index (CPI), between January and March of this year, the food and non-alcoholic beverages category continued to drive inflation, with a 10.22% increase in consumer prices during the first quarter, with potatoes being the product whose cost increased the most: 54.68 per cent.

The tuber was followed by onions as one of the foods that have had the highest price increase so far this year. Meat, poultry, vegetables, fruits, cereals, eggs and processed products also increased in value, according to the above-mentioned report.

Camilo Herrera, director of Raddar, a firm specializing in consumer analysis, confirmed these indications: “A good number of Colombian households have significantly reduced their ability to buy compared to last year.”

Over the course of this week, Raddar published the report on the consumption of Colombians during the month of March, in which this trend was evidenced. The increase in the value of food, a category that most flatters inflation, is displacing the consumption capacity of many Colombians. In March, 75 per cent of cases consumers perceived that they had been able to buy fewer products than in the previous month.

The director of the firm also stated that the families had to sacrifice their expenses from other baskets in order to acquire the basic necessities. This picture, he explained, became more noticeable in foods that had high inflation and occupied 30% of the total pocket of households.

A couple of days ago, the director of Fedesarrollo, Luis Fernando Mejía, explained in the Caracol Radio program '6 AM Hoy por Hoy' that there was a -1.5% drop in food sales. This is based on the Dane survey for March: “Inflation has been rising since the middle of last year, closing in February with a figure of 23.3%. Naturally, with such a high inflation figure, what households do is reduce food purchases.”

Similarly, analysts have assured that consumption by Colombians could be even more affected in the coming months due to the global context. The Bank of the Republic, for example, recently argued that “Russia's invasion of Ukraine could intensify upward pressures on international prices of some agricultural goods and inputs, energy and oil.”

A recent report by the National Association of Financial Institutions (ANIF) states that it is possible that, if the most vulnerable populations in the country are, in turn, the most affected, the rates of poverty and extreme poverty will be affected. This considering the economic fragility they have experienced since the start of the pandemic in 2020.

ANIF simulations suggest that, with the inflationary effect of food, the population living in extreme poverty would increase by 4.2 percentage points, while that in poverty would increase by 1.3 percentage points.

Last year the food situation of households was already compromised. At the end of October, Dane explained, through the Social Pulse survey, that 3 out of 10 households in the country did not consume the 3 meals a day. These indicators were a consequence of covid-19, as the entity pointed out.

*With information from Colprensa

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