Consumers in Brazil are facing a crisis: barbeques, which are a mainstay of Brazilian cuisine and have inspired countless Brazilian steakhouses, are under threat.
The price of beef, pork and chicken in the country are experiencing a sharp rise, even while inflation elsewhere in the country remains low, according to Bloomberg. The meats are up 8.1% month over month in November, threatening to take the main course off the table at many Brazilian celebrations this upcoming holiday season.
Renata Ziller, a teacher and mother of three in Brasilia, said:
“We’ll have to do something with rice, I guess. I’ll have to use some creativity because the prices are so high.”
The price rise has been a result of increased demand for Brazilian meat from China, in addition a drought impacting the quality of many cattle pastures. The price rise has political and economic implications, Bloomberg writes.
Meat was invoked by leftist former President Luiz Inacio Lula da Silva, who said he would fight for the rights of Brazilian workers to “hold family gatherings, have a barbecue, and drink a little beer, which is what makes us happy.”
President Jair Bolsonaro also commented on the price hikes: “People are complaining, rightly, that the price of meat has gone up. The world has started to buy more meat from us. Unfortunately that’s what happens.”
Bolsonaro supports the free market, and said there was little he could do about the price spike - a refreshing take from a politician.
The price of a chicken in the country was up 8% year over year while pork rose 15% and a filet mignon has risen by about 20%. Meat had the largest impact of all products on the country's inflation numbers for November.
Rafael Cortez, from the consultancy Tendencias Consultoria, said: “Inflation in general ought to be a positive factor for the government, however this current rise in a product that is so dear to the average Brazilian could favor the opposition narrative. We are already starting to see this on social media.”
Geovana Santos, a 20-year-old trash collector with a one-year old daughter, said the price spikes have caused her to change her diet:
"Basically I just have to buy sausage, because it’s cheaper,” she concluded.
Eventually, as prices rise, less Brazilians like Santos will eat meat and demand will hopefully taper, causing prices to again slide lower. With free market concepts like these so simple intuitive and effective, it's no wonder Central Banks can't appreciate them.