Consumption fails to rebound, falling 2.7% in June

Despite easing inflation and some signs of economic activity improvement, mass consumption in Argentina remains in negative territory. In June, sales of food, beverages, and toiletries recorded a year-on-year decrease of 2.7%, marking a difficult first half of the year with overall sales in the red.

According to data from the consulting firm Scentia, the basic consumer basket saw a cumulative drop of 2.9% between January and June. This confirms that a widespread recovery in mass consumption is still distant, even amidst a lower inflation environment. The decline was more pronounced in large supermarket chains, which saw a 2.5% decrease, and wholesalers, down 3.3%. Smaller neighborhood stores, however, are managing the demand drop better, with a smaller year-on-year decrease of 1.6%.

The most notable shift occurred in the beverage category, which had been heavily impacted but showed a recovery in June. Sales of alcoholic beverages increased by 9.4%, and non-alcoholic beverages rose by 3.5%. In contrast, categories such as impulse purchases (-6.2%) and breakfast and snack items (-7.7%) continued to suffer significant declines.

Industry observers note that consumers are exercising caution. They are buying fewer items per shopping trip, opting for more economical brands over leading ones, and prioritizing essential goods. This prudent spending behavior reflects ongoing economic uncertainty and its impact on household budgets.