[News] The budgets don’t fit like they used to – Food prices hike in SA and even wine isn’t safe

Bheki Mahlobo | 28 Mar, 2022
In late February, economist and senior analyst at the Centre for Risk Analysis Bheki Mahlobo highlighted three vulnerable sectors subject to change, including fuel, food and energy.

It’s no secret that food has gotten a little pricier as of late in South Africa. Suddenly the budgets don’t quite fit like they used to, and the foods we thought we could rely on for reasonable prices, have betrayed our trust.

If you thought you were simply slacking on cost-effective buying, you can give yourself peace of mind by knowing that, it’s not you, it’s the food.

Recent indexes from Statistics SA showed that many staple foods have seen monthly jumps in increases. Additionally, in comparison to the year before, a stark difference is painstakingly apparent from February 2021 to February 2022.

Especially in Cape Town, the back-to-back comparison between February in both years saw a household shop hike from R3 893.37 to R4203.15 as per IOL.

Impacted foods

Impacted foods include many essentials. StatsSA delivered their Consumer Price Index, and much of the data was not tasty. Oils and fats saw a 22.7% increase, meat was at an 8.6% increase, vegetables a 7.7% increase, bread and cereals a 3.7% increase, and milk, eggs and cheese a 4.7% increase.

Disgruntingly news for Capetonians especially (because of how much these foods are linked to our culture) saw wine at a 6.9% increase, fish at a 5.3% increase and hot beverages at a 3.6% increase.

Restaurants and hotels’ consumer prices for all urban areas were also concluded at increases reaching a 6.1% and 6.3% increase respectively.

In terms of fresh produce, the Competition Commission is set to investigate the market due to concern over the “volatility of pricing for fresh produce in South Africa,” as BusinessTech reports.

Why the price hike?

What was interesting about the price hike in the February comparisons was that annual consumer price inflation, at that point, was 5.7% in February this year, unchanged from January.

The biggest influence has been the Russia-Ukraine conflict. In late February, economist and senior analyst at the Centre for Risk Analysis Bheki Mahlobo highlighted three vulnerable sectors subject to change, including fuel, food and energy.

The Russia-Ukraine conflict has had a knock-on effect impacting global supply chains. African countries imported agricultural products worth around R61.7 billion from Russia in 2020 already, according to Wandile Sihlobo, chief economist at Agricultural Business Chamber of SA (Agbiz). Of this number, roughly 90% of the imports constituted wheat-based products.

For the time being, it looks like Mzansi will have to hold onto our pennies and head back to the budgeting drawing board.

Article originally appeared here.

 

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