Effects of inflation on consumption limit wheat imports by mills in Brazil

Published 2022년 9월 2일

Tridge summary

Brazil's wheat mills have limited cereal imports due to higher raw material costs and inflationary impacts, leading to the lowest wheat imports in Brazil since 2017. The average price per imported ton of wheat has increased significantly due to the ongoing war between Russia and Ukraine, freight costs, and inflation. Despite domestic production of wheat reaching a new record of nearly 10 million tons in 2022, Brazil is still expected to have a trade deficit and will need to import wheat. The increase in the cost of flour, wheat, fuel, and other inputs has led to a pass-through of production costs, resulting in higher prices for products such as pasta, cookies, bread, and industrialized cakes. This has led to a reduction in consumption and changes in consumer behavior to adapt to the high prices.

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Original content

By Nayara Figueiredo SAO PAULO (Reuters) - Brazil's wheat mills have limited cereal imports, with industry representatives and analysts citing higher raw material costs and inflationary impacts that have affected consumption of pasta, cookies and bread. Wheat imports from Brazil in the year to July reached the lowest levels since 2017, totaling around 3.7 million tonnes, according to government data. And they maintained the trend in August, retreating 9.7% compared to the same month last year, to 536.6 thousand tons, despite the period marking the peak of the off-season, before the new harvest becomes available for industries. The average price per imported ton soared from US$276.3 to US$441, according to the Foreign Trade Secretariat (Secex). “The price has increased abroad because of the war (between Russia and Ukraine), freight and everything that is happening (inflation and the effects of the pandemic)”, said the executive president of the Brazilian Wheat Industry Association ...

Source: Istoedinheiro