Valencia, Venezuela – Despite living in an oil-rich country and making a decent salary, Leonardo Gonzalez often can’t buy milk in Venezuela. Grocery stores are full of fine imported chocolates, Chilean wines and frozen fish, but basic staples including fresh milk, sugar and eggs are often unavailable.
“People should get as much milk as they wish to buy. That is how it used to be in Venezuela,” Gonzalez, the purchasing manager at Kromi Market, a grocery store, told Al Jazeera. “Now, people just get what they can find.”
Described as an “upper middle income country” by the World Bank, Venezuela wouldn’t typically be associated with food shortages. A combination of price controls, factory expropriations and alleged “hoarding” by some companies have contributed to scarcity of some products.
“The problem began probably five years ago. Sometimes the situation improves, sometimes it gets really bad,” Jose Quevedo, an employee at the Cotoperi Bakery in Valencia, Venezuela’s third-largest city, told Al Jazeera. “We used to get six to seven packs of milk a day. Now we only get one to two packs daily, and mostly from unpopular brands.” Skim milk is especially elusive, consumers say.
Milk is not the only basic item missing from store shelves. Harina Pan, special flour used to make Arepas, a popular local dish eaten at breakfast, is often out of stock.
Hugo Chavez, the country’s populist president, promised to address the issue of shortages after his re-election on October 7.
Government officials say milk production has increased since Chavez first won elections 14 years ago.
“We have had greater production, but there is more demand for milk,” Paulo Ulloa, a government official in charge of distribution in Carabobo state, told Al Jazeera. “People often buy 10 cartons at once and that causes shortages.”
Others blame government policies, rather than thirsty customers, for the shortages. “Fundamentally, the regulation of milk prices is the problem,” Rafael Araque, a spokesman for the National Federation of Breeders, an industry group, told Al Jazeera.
Producers can only receive 3.6 bolivars ($0.84) per litre from the state when selling their milk, he said, while the cost of production is 4.13 bolivars ($0.96), forcing many farmers to quit the business. “Producers are at the point of bankruptcy… diversification is the only way to keep afloat in the market.”
Some dairy farmers have switched from producing fresh milk to yogurt or non-refrigerated UHT milk to avoid price controls.
Araque cites rising prices for inputs as another issue affecting producers. During 2011, inflation rose above 25 per cent, one of the highest rates in the world. The country’s currency trades at an official exchange rate of 4.5 bolivars to the US dollar, but black-market currency dealers will pay more than 10 bolivars to the dollar, meaning the perceived value of the currency is less than half of the official rate.
Tight currency controls mean business owners cannot enter currency exchange shops or banks to buy US dollars, except under exceptional circumstances. Accordingly, they say they are unable to buy machines, fertilisers and other products. “Animals are bought by the government [from producers] at the official exchange rate,” Araque said. “Producers buy everything at the black market rate – the materials, even the animals.”
High oil prices in recent years allowed for increased public spending, but a decline in the value of crude could cause a full-fledged currency crisis, according to some economists, further inflaming shortages.
Government supporters contend that before the “21st-century socialism” pioneered by President Chavez, much of the population couldn’t afford milk in the first place.
The government has been distributing a quarter carton of milk per child to schools across the country, Ulloa said, as part of the “scholar glass of milk” campaign. Allocating milk to needy school children is more important than keeping the stores fully stocked, government supporters say.
Mercal, a grocery-store chain where the government sells subisidised food in poor neighbourhoods, endears Chavez to his working-class supporters. Some of the products sold here, including Bolivian soy beans, are shipped to Venezuela in exchange for crude oil. These stores frequently suffer shortages, but lower-class consumers are often happy to have access to cheaper food.
“The shortages affects us because we lose a hook; a person who comes to buy milk and cannot find it, may leave the store without buying anything. By noon, there is no milk left in refrigerators.”
– Leonardo Gonzalez, manager at Kromi Market
The household poverty rate in Venezuela dropped from 49 per cent in 1998 to 26.7 per cent in 2011, according to the Centre for Economic and Policy Research, and Chavez’s redistribution policies have been credited for the improvement. Inequality has also fallen significantly.
Self-sufficiency in food has been a goal of the state, but that aim seems unlikely to be achieved in the near future.
Government-backed expropriations affecting “monopolies and landlords” who “tried to starve the population” began in 2002, said Rafael Calles, the mayor of Guanare, a city in Venezuela’s west. Now that Chavez has won an unprecedented third term by a significant margin, expropriations could increase, the mayor said.
“If we want to move from capitalism to socialism, companies must transform from the hands of private people to the workers,” Calles told Al Jazeera.
These calls from elected officials worry some farm operators and consumers. “The government has expropriated many companies, and one of the most affected sectors is agriculture,” said Quevedo. “They are not producing enough milk.”
Back in his grocery store, Leonardo Gonzalez is worried about the future. Shoppers often arrive in the early morning, waiting in lines for the store to open so they can have first dibs on new supplies.
“The shortages affect us because we lose a hook. A person who comes to buy milk and cannot find it may leave the store without buying anything,” he said. “By noon, there is no milk left in refrigerators.”