Food prices in South Africa continue to soar – here’s what you’re paying more for
The latest Household Affordability Index by the Pietermaritzburg Economic Justice & Dignity group (PMBEJD) shows that food prices in South Africa continue to rise despite lower fuel and global commodity food prices.
For September, the group’s basket of nutritional foods came to s R4,805. Month-on-month, the average cost of the basket increased by R30.28 (0.6%), from R4,775 in August 2022, while year-on-year, the basket increased by R586.39 (13.9%), from R4,219 in September 2021.
The year-on-year increase outstrips headline inflation by quite a big margin, and even food inflation tracked by Stats SA. Headline inflation was recorded at 7.6% in August 2022, down marginally from 7.8% in July 2022.
Food and non-alcoholic beverages increased by 11.3% year on year, up from 10.1% recorded the month prior.
The PMBEJD said that rising food prices are concerning given the fuel and global food price trends, raising questions about whether or not retailers and the supply chain are fleecing consumers.
“For the past three months, fuel prices and global food commodity prices have come down, yet we do not see a corresponding drop in food prices at the retail level,” it said.
“Due to a lack of transparency in the local food value chains, we are unable to identify where in the chain inflation remains stubbornly high. The question remains whether the industry is passing on the lower costs to the consumer or not?”
The group said that the Reserve Bank’s rate hikes – including the latest 75bps move – have been done with the argument that it would bring down food inflation. However, if retailers and the supply chain for food are withholding savings from consumers, this will not have the intended effect.
“If, indeed, retailers are not passing on lower costs, then raising interest rates will simply bring more pain to the South African consumer, make us all poorer and potentially increase unemployment and further contract the economy – without addressing the problem of lowering food price inflation,” it said.
“It is our submission that instead of raising interest rates, an assessment be made to identify where in the value chains food inflation remains stubborn, and deal with this through appropriate intervention, if and where such high inflation is not justified.”
Rising prices
The PMBEJD’s data shows that South Africa saw steep increases in white bread, onions, wors, tomatoes, butternut, oranges, and stock cubes in September. Cooking oil dropped by an average of R20.68 per 5 litre bottle – or a drop of 9%.
However, despite some relief, the average cost of the core foods in a household basket – foods that are prioritised and bought first – remained too high in relation to the ability of households to pay.
“In September, the cost of these foods is R2,654. Over the past year, these core foods have increased in price by 16.5% (R375.56),” the group said.
Food prices September 2021 to September 2022 – big changes
The PMBEJD basket comprises 44 core food items most frequently purchased by lower-income households, who make up most households in the country.
Year on year, four items in the basket came down in price, with one remaining the same. The other 39 items all went up in price.
Some of the biggest price changes (±10%) include:
- Cooking oil: +56%
- Tomatoes: +56%
- Cake flour: +26%
- Onions: +26%
- Maize meal: +24%
- White bread: +22%
- Brown bread: +21%
- Butternut: +20%
- Cremora: +20%
- Green pepper: +19%
- Margarine: +17%
- Canned beans: +16%
- Samp: +16%
- Spinach: +15%
- Frozen chicken portions: +14%
- Wors: +14%
- Beef: +13%
- Stock cubes: +13%
- Tinned pilchards: +13%
- Inyama yangaphakathi: +11%
- Full cream milk: +11%
- Apricot jam: +10%
- Cabbage: +10%
- Potatoes: -15%
- Oranges: -19%
Month-to-month changes are generally more marginal, but a few items saw big changes. Overall, five food items remained unchanged, 20 increased in price, and 19 came down in price.
Food prices August 2022 to September 2022 – big changes
- Onions: +12%
- Butternut: +10%
Regional
Regionally, the difference in cost of the total household food basket in Joburg, Durban and Cape Town is consistent at around ±R150.
Springbok and Pietermaritzburg tend to be outliers in the data (Springbok being the highest, and Pietermaritzburg being the lowest).
- The Joburg basket increased by R14.00 (0.3%) month-on-month and increased by R659.97 (15.6%) year-on-year to R4,902.51 in September 2022.
- The Durban basket increased by R6.55 (0.1%) month-on-month and increased by R543.37 (12.7%) year-on-year to R4,814.32 in September 2022.
- The Cape Town basket increased by R48.33 (1.0%) month-on-month and increased by R566.77 (13.8%) year-on-year to R4,672.95 in September 2022.
- The Springbok basket increased by R187.96 (3.8%) month-on-month and increased by R525.13 (11.4%) year-on-year to R5,120.27 in September 2022.
- The Maritzburg basket decreased by R15.28 (-0.3%) month-on-month and increased by R576.75 (14.1%) year-on-year to R4,655.05 in September 2022.
Read: New inflation data is bad news for food prices in South Africa
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