Government digs in its heels: No price rise as producers apply more pressure

Caracas Daily Journal (Jeremy Morgan): Deputy Agriculture Minister Richard Canan said the government would guarantee beef supplies as food producers renewed pressure on the authorities to remove meat from state price controls.

Beef prices would not be increased, even if "intermediaries" such as the big refrigerated stores were pressing for higher prices, he said. He spoke during a tour to ensure that suppliers were applying controlled prices set out in the Official Gazette.

The ranchers' federation, Fedenaga, had warned that the supply situation was turning out as it had earlier warned, and could become critical because national output could barely meet 50 percent of demand, and what was needed was to lift the controls. This wouldn't lead to an exaggerated increase in prices but stability on the supply chain, Fedenaga President Genaro Mwndez claimed.

Venezuela's biggest business organization, the Federation of Chambers of Industry and Commerce (Fedecámaras), joined in the fray saying that prices had to be revised and "adjusted" because Venezuela had an "inflationary economy." The correct measures to correct this had not been applied, said Fedecamaras President Jose Manuel Gonzalez. As to whether there would be five percent economic growth this year, Gonzalez said he was holding judgment. The Foreign Exchange Administration Commission (Cadivi) was still taking 100 days or more to authorize access to hard currency.

Méndez said the shortfall in domestic output of beef was being covered with imports and the people hadn't noticed growing dependence on imports as production dropped 100,000 tons in 2007. Imports then met 42 percent of demand, but now, 50 to 55 percent of the beef would be imported. However, Mendez felt this might not be possible. "There are problems with prices at international level," he claimed, echoing similar warnings sounded when powdered milk went seriously short. There was strife between farmers and the government in Argentina and difficulties in obtaining hard currency permits to import from Brazil, he said.