What Will Get More Expensive With War

The war between Russia and Ukraine directly threatens the pocket (and the joy) of Brazilians. The increase in the price of commodities used on a large scale, such as oil and wheat, is expected to impact the prices of products that Brazilians love, such as meat, beer and bread.

“Oil, natural gas, fertilizer and wheat were the first to be impacted. But these four products end up affecting a vast chain. The increase affects fertilizers, which impacts soy, corn, animal feed and protein (mainly pigs, milk and eggs )”, said Roberto Dumas, a professor at Insper and a specialist in international economics. O UOL talked to experts and listed some of the everyday products of Brazilians to understand the impact of the war on prices. Check out:

Beer

Beer - Monica Di Loxley/Unsplash - Monica Di Loxley/Unsplash

War’s economic impact could affect the price of beer

Image: Monica Di Loxley/Unsplash

The war has already affected the importation of some basic materials for the brewing sector, such as wheat and barley, according to Paulo Petroni, president of CervBrasil (Brazilian Beer Industry Association) given that Russia and Ukraine are major exporters of wheat and barley and should reduce the pace of production.

“The prolongation of the war, with the reduction of exports from Russia and Ukraine, in addition to the logistical problem, will bring problems and increase the price of raw materials for beer,” he said.

According to him, other costs, such as high energy and fuel, should also put pressure on prices. “What we already feel, in a very strong way, is the question of the cost of energy, both electric and gas. It has gone up a lot.”

As distribution is done by trucks, the increase in fuel also weighs heavily on the final price, he said.

Barbecue

Barbecue - Owen Franken/Getty Images - Owen Franken/Getty Images

Toasted barbecue meat may be further away from Brazilians’ pockets with the effects of war

Image: Owen Franken/Getty Images

Another item that Brazilians love and that will also suffer inflationary pressures because of the conflict is barbecue meat. According to ABPA (Brazilian Association of Animal Protein), corn and soybeans, which represent more than 70% of the total cost of production, have accumulated increases of more than 100% in recent months, and are now facing the effects of the conflict in Eastern Europe.

“Producers have been feeling the weight of the difficulties imposed, and several are working in the red. Some report the reduction of production capacity in the face of high costs of the agroindustry”, said Ricardo Santin, president of ABPA.

“With the sharp rise in production costs, there is already a transfer to the price of the product for the final consumer. New transfers may occur with the continued increase in costs”, he added.

Bun and sweets

Bun - iStock - iStock

Bread can be expensive because of the impact of war

Image: iStock

The bun, sweets, candies and chocolates should also have high prices.

“The war will reduce the supply of wheat in the world. In addition, Ukraine exports fertilizers to Brazil, which should impact the supply of agricultural products here, causing the price of products and their derivatives to increase, such as bread and masses,” said Johnny Mendes, an economics professor at Faap.

According to Abicab (Brazilian Association of the Industry of Chocolates, Peanuts and Candies), the lack of grains may have a greater impact on the sector soon.

“The situation has mainly affected the peanut production chain, since 48% of Brazilian exports of the grain are destined for Russia and Ukraine. We are closely monitoring the unfolding of the conflict and, at the same time, studying scenarios and possible solutions to minimize the negative impact on the sector”, said, in a note,

caviar and vodka

Although not popular products, vodka and caviar are symbolic of Russia. The sanctions imposed by Western countries as a form of punishment for the war against the country can inflate the prices of products, but they should not reduce consumption here.

“Vodka and caviar impact the richest class and they don’t stop consuming it, even more expensive”, said Roberto Dumas, from Insper.

Gasoline

Gasoline - Twitter/Reproduction - Twitter/Reproduction

Memes involving gas prices were shared on social media

Image: Twitter/Play

Perhaps the greatest impact of the conflict is on the price of oil, which soared and was quoted at around US$ 140 a barrel, which made fuel more expensive in Brazil. The increase should make not only products in general, which depend on road transport, more expensive, but also weekend trips by Brazilians.

According to Johnny Mendes, the general increase caused by more expensive oil should put pressure on inflation in Brazil.

“Brazil’s main modal is road transport and, with the increase in fuel, there will be an increase for basically all the prices of the groups that make up the IPCA (Broad Consumer Price Index), which measures official inflation,” he said.

About Abhishek Pratap

Food maven. Unapologetic travel fanatic. MCU's fan. Infuriatingly humble creator. Award-winning pop culture ninja.

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