Transportation costs increased by 3.82% in June in Argentina

Only in June, the costs borne by land transport companies increased by almost 4%, with an increase in the first half of 15.8. This is the result of the monthly cost index produced by the Cargo Autotransport Federation of Argentine Carriers (FADEEAC). The increase is 34.3% since July 2017.

Freight transportation costs climbed 3.82% in June, mainly due to a sharp increase in fuel prices – after the virtual freeze of May -, and, almost at the same time, because of the large variations in items related to the exchange rate adjustment. If an 8% increase in wages is forecast for July, given the signed collective agreement and the new gasoline increase estimated at around 6% by the major oil companies on July 1st, the The index would rise to 21%% between January and July 2018.

With an increase of 4.4% this month, diesel fuel registered an increase of 16.7% in the first half and 33.7 % since the deregulation of the hydrocarbon market in October 2017. With the July increase, the projection for the first seven months of the year could reach or even exceed 24%. At the same time, as a result of the peso devaluation, 12.7% purchased rolling stock and 9.2% more repaired equipment. The strong increase in lubricants (20.9%), tires (9.8%) and insurance (5.8%) was also highlighted.

The financial cost climbed by 3.48%, while the rest of the 11 items badyzed did not change. by the Department of Studies and Tax Costs prepared by the FADEEAC Index

Freight Inflation

An average of 3 "freight" inflation points was recorded during 2018, in a context where they are expected significant cost adjustments throughout the transport and logistics chain for the second part of the year. This situation coexists with a marked deceleration of activity

According to FADEEAC, this upward momentum is largely badociated with the deregulation of the hydrocarbon market: since its start on October 1st, the transport cost index increased by 26%. % With the projections of July, it would reach a notorious increase of 31% in 10 months whereas, this diesel would reach a worrying 42%. This is an average increase of 4% per month in the "deregulation-alignment of domestic fuel prices with international prices" regime.

Therefore, it projects a "freight" inflation for 2018 much higher than that recorded in 2017 (24%), with the exacerbation of the freeze of activity, that FADEEAC understands that 39 it must be declared in an emergency situation since it must, in addition, face the constant tax burden which reaches 40% of the final freight rate. 19659002] Source: Argentine Federation of Autotransport Companies of Cargas.