The transport system is like the blood stream in the body. When it flows normally it does not attract attention, when faults appear, there is a danger of collapse. Something like this is happening right now with the lack of diesel that is already hampering operations in the middle of the harvest, making industrial and service logistics difficult, with special emphasis on the north of the country, and threatening the paralysis of entire segments of the production chain. .
“Ultimately, the whole problem is due to price distortions between imported diesel and the one paid in the domestic market. And this is because of the energy policy: we want to close the door on international prices and they slip through the window when we have to import them,” says the consultant and former director of YPF, Daniel Montamat. The reasons for this disparity are quite clear: for each liter of diesel sold, with the prices of last May, the difference was 32%: if the oil companies imported the missing amount, they would lose $50 per liter. Still, other global fault lines appear on the horizon, colluding in a kind of sector perfect storm.
Catering. In the first place, the local production of diesel is working at full capacity without the capacity to supply the fuel at the usual peaks of demand: the planting and harvesting season, in the field; and winter, as an input for thermal power plants. From the international gas shortage (inflation in the eurozone climbed to 8.1% annually and 39.2% for energy), the generators used more fuel for their production.
The shipment numbers are not minor. Last year, diesel was imported for US$ 4,000 million: 25% for power plants, 20% for ultra diesel and 55% for trucks and tractors. This year, with a rise in dollars on the international market, the foreign trade imbalance would be even greater, but above all a need for dollars that are scarcer than diesel: the reserves of the central bank. as it points Jorge Vasconceloschief economist at IERALin the first quarter, “except for the case of energy and fuels, whose imports rose 195%, the rest of the items showed increases of between 30% and 35% compared to the same period in 2021.” The energy trade balance, which in the first quarter of 2021 had registered a positive balance of US$156 million, went to a red of US$453 million in the same period of 2022. Imports from the sector totaled US$3,040 million between January and April.
As highlighted in the consultant’s report Invecqthis coexists withWith an agricultural liquidation that presented the highest monthly historical record in May: US$ 4,231.7 million. Year-on-year, the liquidation grew by 19.3%, while the improvement compared to April was 33.4%. Dollars that come in, but they evaporate. Will dollars run out as fast as diesel?
Rates. The long-term view of this sector points to a recipe that had its setbacks: greater use of the biodiesel blend (was 10% and was lowered last year to 5%) as a way to free up refining capacity to supply a growing curve. The other, more difficult to achieve in the short term, is to balance the gas market so that its use does not compete with gas oil in thermal power plants. Of course, in this proposal, any proposal enters a taboo zone: the price of electricity and gas. In the latest IAE economic report, it shows that “lhe energy subsidies are equivalent to 2.3% of GDP, one of the highest in Latin America, and that the current rate and subsidy scheme means that energy cost recovery is less than half”.
At the core of these decisions is the chain of regulated prices and open or covert subsidies that cause these anomalous behaviors in the market when dollars stop flowing, in the case of imports or pesos, due to fiscal burden.
This is the case of freight transport, the main user of increasingly scarce diesel and facing several simultaneous challenges. Since January, the Transportation Costs index prepared by the Argentine Federation of Business Entities of Freight Transportation (FADEEAC) and that measures 11 items that have a direct impact on costs,it increased 37% and 62% year-on-year, well above the CPI.
emilio felcmandirector of economic studies at FADEEAC, points out that the system transports more than 90% of the merchandise reaching all corners of the country and is an activity closely linked to the real economy. “The 2021 recovery was very important. It had a positive spillover throughout the economy, but now it coexists with accelerated inflation and a problem in the fuel market, which will end up putting a brake on this recovery”, he notes.
For Paul Gunning, executive director of the Argentine Federation of Transport and Logistics Entities (FAETYL), “All this is an economic problem, but also an estimation problem: making a mistake in the amount of fuel needed for land transport. I want to think that it was a bad estimate on the part of the demand, ”she maintains.
minced ticket. The other segmentation involved in this market is the passenger transport segment. There, to the inconvenience of fuel shortages, another fine thread is added with which this chain always threatens to be cut: the distribution of subsidies. Marcelo Rodio, Secretary of Transportation of the City of Córdoba, is one of the promoters of the federal ticket project to match the fiscal support currently received by the metropolitan transport system in the cities of the interior with that received in the AMBA. His estimate indicates that in the AMBA each unit receives a monthly subsidy of $1.1 million, while in Córdoba the amount is $200,000. Already the businessmen of the sector made their own calculation and threw them more than $190 as cost of the service. It is not very far from the price that urban transport has in the entire region: US$ 1, much more than what users pay in Argentina and much less than what they do in other large cities of the developed world (between US$ 2 and US$ 7 per trip depending on the payment system and the section used). During convertibility, for example, in the interior of the country the price of a bus ticket was US$0.90 against US$0.60 in Greater Buenos Aires. Today that gap seems to have widened and the reason is because cost inflation was at a much higher rate than ticket updating.
The difference is covered jointly by the municipalities, the provinces and the Nation, so the time it takes to become effective also plays a role (today it is up to two months). A system that reveals, once again, the status of pampered electorate to the almighty of the urban cordons of Buenos Aires. Meanwhile, the railway system decreased its transformation as the transportation axis of the AMBA for the simple reason that it demands fabulous amounts of an asset that is on the verge of extinction: investments. In the meantime, Argentine trains It is already the company with the most personnel in the country: 30,000 hired in a dependency relationship. It only remains to adjust a few small details and obtain the funds to execute the dreams of interconnection. Almost as difficult as getting diesel at pump prices.
