Food inflation in South Africa increased again last month, the Bureau for Food and Agricultural Policy (BFAP) has reported in its Food Inflation Brief-July 2021. The increase was both in month-on-month and year-on-year terms. There has been a trend of increasing food inflation in the country since February.
While the month-on-month increase was just 0.2%, the year-on-year comparison showed a jump of 6.7%. Food inflation contributed 1.1 percentage points to the consumer price index headline inflation figure of 4.6% during July.
There were, however, significant differences between the different food groups, in both month-on-month and year-on-year terms. Thus, month-on-month, bread and cereal prices went up by 0.2%, meat by 0.7%, oils and fats by 0.4% and fruit by 0.7%. On the other hand, the prices for fish declined by 0.9%, those for milk, cheese and eggs fell by 0.1%, while vegetable prices came down by 1% and sugar and sugar-rich foods saw a decline of 1.2%.
In year-on-year terms, oils and fats saw by far the biggest increase – 22.4%. Meat came second, at 9.4%, followed by sugar and sugar-rich foods at 6.5%, then milk, cheese and eggs at 6.3%, vegetables at 4.7%, fish at 4.6% and bread and cereals at 4.4%. However, fruit prices fell by 2.7%.
Regarding individual food types, the following suffered from year-on-year inflation of more than 10%: plant oils, pork (such as chops and ribs), margarine, dried beans, beef (for stews, and offal), individually quick frozen chicken and fresh cuts of chicken, super maize meal, pumpkin and bananas. The foods that experienced year-on-year inflation of between 6.7% and 10% were chicken giblets, canned pilchards, white sugar, polony, cabbage and beef (such as mince and brisket).
The price of the BFAP Thrifty Health Food Basket (THFB) increased by R17, or 0.6%, in month-on-month terms, and by R119, or 4.2%, year-on-year. The THFB is composed of 26 food items from all the food groups, and is designed to feed a family of two adults (one man, one woman) and two children for one month. Assuming the family is earning two minimum wages, receives child grants and benefits from school feeding programmes, the THFB would have taken 29.7% of the family’s total income during July.
“We expect that food inflation will decline over the coming months as base effects ease and other key drivers such as the oil price ease off recent highs,” stated BFAP. “The effect of the global spread in the Delta variant of the Covid-19 virus is expected to retard global recovery, which will probably spill over into global and local food and commodity prices.”