This year’s Christmas promises to be one of the most expensive in recent memory as food inflation increased by at least 14.0%, according to agricultural economists, who also warned that consumers will have to dig deeper into their pockets, especially for vegetables.
Daniël Minnaar, Agri Western Cape economist, said food prices in South Africa have slowed since the first quarter of 2023, when food inflation increased by at least 14.0%, leaving South African consumers facing high prices for basic foods such as bread, vegetables, fruit and chicken.
He said vegetables were the food category that had both the highest month-on-month (MoM) and yearon-year (YoY) inflation rates, with an increase of 7.1% and 23.6%, respectively. Sugar-rich foods (17.6%), dairy and eggs (12.4%), bread and cereals (8.8%), and fruit (8.5%) were the other top 5 categories with the highest YoY increase.
“Compared to a year earlier, the average national price of potatoes is now R66.89/10kg. The cost of tomatoes dropped by R7.13/kg. It is anticipated that over the next few weeks, prices would rise. The average cost of a large carrot jumped to R5.22/kg, while the price of carrots increased by 20% to R4.98/kg. We anticipate that over the holiday season, prices will approach R7/kg,” said Minnaar.
He said the national average price of onions perked up, closing the day at R35.60/10kg. Although it dropped to R11.33/kg on average, the average pepper (capsicum) is predicted to rise.
The price of other veggies, such as cabbage, dropped by 10% to R2.16/ kg. Garlic prices dropped to R42.63/ kg, spinach went up 17% to R3.10/ kg, pumpkin went down to R3.04/kg and sweet potato prices decreased to R11.41/kg.
Thabile Nkunjana, agricultural economist at the National Agricultural Marketing Council (NAMC), said: “With the holidays and Christmas fast approaching, many consumers are concerned about how food prices would affect them, as many food items tend to rise around this time of year when consumers prepare for holidays.”
He said prior to 2023, local food prices reacted to elevated global food prices caused by market shocks, such as drought in key world food-producing regions like South America, strong demand for grains and oilseeds from influential global countries, higher fuel prices, and the Russia-Ukraine war from a global perspective.
This year’s Christmas promises to be one of the most expensive in recent history, according to Chris Hattingh, executive director at the Centre for Risk Analysis.
He said the agriculture sector contracted by 9.4% in the third quarter of this year due to ongoing electricity issues as well as the avian flu.
“Food and non-alcoholic beverages inflation increased for a second consecutive month, rising to 8.7% in October. Milk, eggs, and cheese inflation delivered a large increase, up to 12.4% in October from 11.2% in September. The egg price index increased by 13.4% from September,” said Hattingh.
He said should Eskom once again return to Stage 4 load shedding and higher, a possibility given diesel budget constraints and unplanned outages that are perennially a problem, the feed-through impacts on food producers and retailers would be decidedly negative.
“Their higher operating costs will be factored into daily operations and eventually passed on to consumers.”