To dodge the increases, companies cut costs and shut down freezers – Economy

Metal
Metalrgica de Cludio, in the Center-West of Minas, entered the free energy market to negotiate directly with a supplier and achieved savings, but it has to project consumption and may have additional for that. (photo: Gabriel Arajo/Divulgao – 8/7/21)

Pressured by the impact of the COVID-19 pandemic, which has already hampered the expected recovery in sales, after the reopening of trade, industrial and agribusiness entrepreneurs are now focusing on measures to reduce the energy bill, a high expense in intensive segments in the use of inputs, such as equipment factories, footwear and baked goods. In Minas Gerais, there are cases in which the increase in energy costs has reached 50% since last year, a reason for warning in production.

Polo lime
Nova Serrana footwear pole invests in improvements to optimize consumption, while bearing part of the loss, because the alternative has limitations, as do furniture companies

(photo: Gladyston Rodrigues/EM/DA Press – 9/7/19)

The alternatives range from general cost cutting at companies, keeping machines connected in the shortest time possible and even extreme attitudes such as turning off mass consumption equipment, such as freezers and refrigerators, as reported by entrepreneurs in the footwear, furniture, sectors, of the bakery and livestock industry heard by the State of Minas. This is how they respond to yet another unfortunate statement by Economy Minister Paulo Guedes. On Wednesday, Guedes ironically downplayed the persistent growth in the energy bill, associated with the country’s historic water crisis.

– Energy expenditure reaches 40% of the cost of industrial production

During the launch of the Parliamentary Entrepreneurship Front, in Brasilia, the minister asked: “What is the problem now that energy will be a little more expensive because it rained less?” In addition to more expensive energy due to the activation of thermal plants, which produce at a higher cost than hydroelectric plants, in June, the National Electric Energy Agency (Aneel) announced a 52% readjustment in the level 2 red flag tariff, which price went from BRL 6.24 to BRL 9.49 for every 100 kWh.

The impact, which should be valid until November, directly influences small and medium-sized companies, whose consumption is precisely in the range of the expected increase. Electricity became 5% more expensive in August, according to the survey by the Broad National Consumer Price Index-15 (IPCA-15), prior to the country’s official inflation. exerting the greatest impact (0.23%) among the sub-items monitored by the Brazilian Institute of Geography and Statistics (IBGE).

The statement by Minister Paulo Guedes, who argued that “to keep crying” does not make any sense in the face of the current moment experienced by various sectors, which are trying to circumvent the impact of expensive energy on production. When they cannot find an alternative, they pass on part of the loss to the customer. “The cost of electricity relevant to the company. And it increases at the same time that several inputs were readjusted as well. We don’t have many alternatives, apart from making improvements to the electrical part to save something, although this takes a while to happen. All of this influences the manufacturing cost and, therefore, the final price for the customer,” says businessman Ronaldo Lacerda, 45, factory owner Lynd Calados, in Nova Serrana, in the Midwest of Minas Gerais.

In the furniture industry, the scenario of difficulties is similar. The energy bill of businessman Marcelo Arajo, who owns a factory in Mateus Leme, in the Central region, practically tripled in this pandemic – it reached almost R$300. , highlights. Searching for cost reduction measures has become routine at the industrial unit. “What we have been doing is trying to make the furniture in scale so as to leave the machinery on for as little time as possible”, he explains.

The solution found by the metallurgical company Amap, headquartered in Cludio, in the Center-West of Minas Gerais, emerged even before the last readjustment of the tariff flag announced by Aneel and showed that the decision was correct. The company entered the free energy market, where companies and consumers can buy directly from generators. With this, it gave up the market regulated by the government, managed to make longer-lasting contracts and can buy energy at a lower price.

“We chose this modality for two reasons. The first is not to be left in the hands of captive energy, since Cludio has a considerable volume of industries and before that we had to keep several generators running. And another factor is that in the free market you make contracts with suppliers and manage to shield these energy fluctuations”, emphasizes Gabriel Faria, the company’s Commercial and Marketing manager.

The company estimates that it achieved savings of 30.5% in July, given the full impact that the increase in the red flag would have meant. “We suffer less from these fluctuations due to this strategy. We often have to make a contract projecting consumption and, when we go beyond it, the extra can be more expensive. But the consumption is considerable”, explains Faria, who announces that the company may, in the future, build a photovoltaic plant.

‘Turn off the light’

Bakeries and bakeries represent one of the sectors that suffer most from the increase in energy expenditure. Without replacing electric ovens with wood-powered ones, they have to face the drama. Owner of a bakery in Bairro Betnia with more than three decades of existence, Carlos Marques, 55, says that he has never seen such high inflation hit his business.

He regrets having to deal with the increase in energy at the same time that he lives with the inflation of inputs, such as flour and wheat, whose prices follow the prices of the dollar, as the country depends on imports of these products. “We always have to use the machines and there is no other way to get around this increase. What we can reduce maybe dim a light, turn off a lamp, but the rest is hopeless. And then there’s the increase in flour, which, when the dollar goes down, it doesn’t follow the price. In this sense, it is very difficult to reduce the cost”, he says.

On the field, it’s already expensive and there’s no support

Those who survive from production in the field also struggle daily to seek new options for saving on expenses. Farmer and poultry farmer Gilberto Leo, 58, who owns a farm in Ritpolis, Campo das Vertentes, says that his entire activity is very dependent on electricity. According to him, the account has grown almost 50% since last year, directly affecting the business. The most you can save by not turning on freezers or refrigerators.

“Anything that touches the producer’s pocket is very significant, because we can’t pass on this price. From the gate in, I can manipulate the production. But, from the gate outwards, whoever commands the market”. Gilberto Leo uses energy in the cooling tank, in preparing feed for raising poultry and in the milking machine.

The producer criticizes the lack of concrete actions by the federal government to help small and medium-sized rural properties and proposes a subsidy in the investment of solar energy, which can be a good solution for those who live in the countryside. “We have lighting with ease. If possible, we would produce our own energy and automatically save energy for the urban area. It would be a great idea”, he says.

‘Turn off the light’

Unlike Minister Paulo Guedes, yesterday, President Jair Bolsonaro (no party) acknowledged the gravity of the water crisis, which he considered “the worst in history”. Bolsonaro asked the Brazilians to save money and “extinguish a point of light” in the residence. “Despite the fact that we are living the biggest hydrological crisis in history, 91 years since we had a crisis like this… I’ll even make an appeal to you who are at home now: I’m sure you can extinguish a point of light in the your home now. I ask this favor for you, turn off a spot of light now”, said the president in weekly live.