South American fans bite their nails over World Cup chances - and inflation

Ambev SA

06/11/2022 11:00

By Gabriel Araujo
       SAO PAULO, Nov 6 (Reuters) - In South America, home to
the some of the world's starriest soccer players from
Argentina's Lionel Messi to Brazil's Neymar, avid fans are
starting to get jitters about their countries' World Cup chances
- and the rising cost of supporting them.
    The region of about 650 million people is battling some of
the world's worst inflation, including in Argentina where prices
are set to climb 100% this year. That is pushing up costs from
soccer stickers and jerseys to game time snacks and beer.
    "Prices are just too inflated," said 20-year-old Brazilian
Breno Nery, who was buying popular collectible soccer stickers
in a Sao Paulo mall. A pack of five stickers has doubled to 4
reais ($0.79) since the 2018 Russia World Cup.
    It is even worse in Argentina, where the suggested price of
a pack has jumped 900% to 150 pesos ($0.95) after years of
sky-high inflation. But a shortage has also led to prices
doubling or tripling on the internet or alternative markets.
    Prices have been surging for all sorts of goods from
merchandise and collectibles to the food and beverages fans are
likely to buy once the competition starts this month in Qatar.
Brazil and Argentina are among the favorites.
    In Buenos Aires if fans want to buy a soccer jersey, they
will also have to reckon with even higher prices thanks to a
skewed foreign exchange rate linked to strict capital controls
and supply chain disruptions.
    In Argentina the new Adidas  ADSGn.DE  national team shirt
will cost 28,999 pesos, a whopping 1,658% rise from the last
World Cup, while in Brazil, Nike Inc  NKE.N  launched the latest
"Selecao" shirt at 349.99 reais, a 40% jump.
    "This time Brazilian fans will bite their nails not only
when cheering for the national team, but also when paying their
bills," brokerage XP  XP.O  said in a recent report.
    Despite the price rises, sales of Brazil's kit have leapt
40% from 2018 by volume, said Nike distributor Grupo SBF
 SBFG3.SA . Not everyone is convinced, though.
    "I think I'll just wear a random shirt with 'Brazil' written
on it," said Daniel Santos, 20, speaking at a shopping mall in
Sao Paulo.
    STICKER SHOCK
    The World Cup will be played from Nov. 20 to Dec. 18 - late
spring in the southern hemisphere, a change from the normal
dates that fall in the region's winter.
    The balmier weather has companies such as meatpacker BRF
 BRFS3.SA  and brewer Ambev  ABEV3.SA  expecting sales to get a
bump as South Americans gather with family and friends to watch
matches with a cold brew or celebrate with a barbecue.
    But fans will be in for some sticker shock.
    Meat is now almost 80% more expensive in Brazil than four
years ago, according to XP, a rise almost three times steeper
than overall inflation. Soda and beer prices have surged 20%.
    Argentina's traditional asado beef prices rose more than
600% from June 2018 to August 2022, data from local industry
group IPCVA showed. A liter of beer has nearly quintupled in
cost.
    The World Cup even led Argentina to launch capital controls
of overseas travel and spending dubbed as the "Qatar" FX rate,
making travel to the Middle East nation even more expensive in
local currency. 
($1 = 5.0557 reais)
($1 = 158.2900 Argentine pesos)
 (Reporting by Gabriel Araujo; Editing by Christian Plumb, Adam
Jourdan and Daniel Wallis)
 ((Gabriel.Araujo2@thomsonreuters.com; +55 11 5644 7745;))