Food prices in March rise well above inflation
THE PRICE of 33 out of a basket of 44 basic foods increased by 10.6 percent year-on-year in March, according to the Pietermaritzburg Economic Justice & Dignity Group (PMBEJD), which monitors the prices of foods typically bought by lower income families.
PMBEJD programme co-ordinator Mervyn Abrahams said the most significant increases were for cake flour, cooking oil, eggs, tea, and bread and also included maize meal, rice and white sugar. The average increase is almost double the inflation rate of 5.7 percent.
The March 2022 Household Affordability Index, which tracks food price data from 44 supermarkets and 30 butcheries in lower income areas of Johannesburg, Durban, Cape Town, Pietermaritzburg and Springbok in the Northern Cape, showed that the Johannesburg basket increased by R86.64 (2 percent) from February, and by R430 (10.6 percent) year-on-year.
The Durban basket increased by R16.22 (0.4 percent) and R366.30 (9 percent) year-on-year. The Cape Town basket increased by R151.38 (3.6 percent) and R394.08 (10 percent) year-on-year. The Springbok basket increased by R163.87 (3.6 percent) and R496.22 (11.7 percent) year-on-year.
The Pietermaritzburg basket increased by R51.95 (1.2 percent) and R396.62 (10.3 percent).
Abrahams said the outlook for food prices, specifically due to the higher Brent crude oil, wheat, other grains and cereals and legumes and oil prices, including higher forthcoming electricity price tariffs, was likely to be very severe for South Africa.
Statistics South Africa’s Consumer Price Index for February 2022 showed that headline inflation was 5.7 percent, while Consumer Price Index Food inflation was 6.7 percent. Abrahams
said food was bought by lower income families only after money for transport and electricity had been paid or set aside. PMBEJD calculated workers’ families would underspend on food by a minimum of 37.2 percent this month. This underspend came after the new National Minimum Wage increment had been implemented and before the impact of much higher fuel prices, food prices and the new
electricity tariff of July, which would all come crashing down on workers.
“R1.50 extra an hour is the buffer that government has provided to the millions of South African workers who use their wage to provide not only for their own families but the millions of people that are unemployed.
“It will take but a short time for this buffer to be eviscerated. In this context we are all likely in for a very
tough year,” said Abraham. Agbiz chief economist Wandile Sihlobo said agricultural commodities prices had continued to surge on the back of the Russia-Ukraine war. “But the effects of the war on agricultural commodities prices have not yet fully reflected on the retail prices of various food products due to the lag in price transmission. The price increases will likely reflect, partially, from March 2022 consumer
food price inflation and the months that follow. “So far, we have South Africa’s consumer food price inflation data for February, which accelerated to 6.7 percent year-on-year, from 6.2 percent year-on-year in the previous month. “Bread and cereals, meat and fish, are the primary products that underpinned this mild uptick in overall consumer food price inflation in February,” Sihlobo said.