The Bureau for Food and Agricultural Policy (BFAP) on Tuesday warned that the Russia-Ukraine crisis could “substantially” drive up global and so local prices for maize, wheat and vegetable oils. Ukraine was the world’s number four maize exporter, with an about 15% share of global exports, and Russia was a top exporter of wheat, whose share of global exports was some 20%. The two countries also ranked in the top ten of sunflower seed exporters.

“[T]he risks associated with rising tensions between Russia and Ukraine could influence both international commodity prices and investor risk sentiments which may lead to depreciation in the Rand exchange rate,” cautioned BFAP. “Through its influence on energy, international commodity prices and exchange rate depreciation, possible escalation of tensions in the Black Sea region presents a major risk factor to food inflation.”

This warning was contained in BFAP’s Food Inflation Brief covering January, released on Tuesday. Inflation on food and non-alcoholic beverages rose 0.9% in month-on-month terms and 5.7% in year-on-year terms. The sector accounted for one percentage point of the consumer price index headline inflation rate of 5.7%.

Among the various food categories, vegetables recorded the highest month-on-month price increase, of 3.4%. They were followed by oils and fats, at 2.9%. Third came meat, at 1.2%, followed by fruit (0.8%), fish (0.6%), bread and cereals (0.4%), milk and cheese and eggs (0.3%), and sugar and sugar-rich foods (0.2%).

In year-on-year terms, the food category which recorded the highest inflation was oil and fats, at 22.9%. Second place was taken by vegetables (8.6%), followed by meat (8.2%). Milk and cheese and eggs followed, at 5.2%, then fish (4.6%), sugar and sugar-rich foods (2.9%), and bread and cereals (1.5%). Fruit actually recorded year-on-year deflation of 2%.

Concerning individual foods, those that registered year-on-year inflation of more than 10% were (in the order given by BFAP) margarine, beef (offal, rump, sirloin, brisket), pumpkin, sunflower and canola oil, tomatoes, mutton and lamb loin chops, eggs, fresh whole chicken, cabbage, frozen hake and whiteners. Those foods which recorded inflation of between 6% and 10% over the same period were (again in BFAP’s order) spinach, pasta, bacon and ham, cake flour, beef mince, white and brown sugar, frozen fish fingers, flavoured yogurt, fresh low-fat milk, polony, and frozen chicken portions.

The price of BFAP’s Thrifty Healthy Food Basket (THFB) increased by 0.9% in month-on-month, and 4.6% in year-on-year, terms. In money, the month-on-month increase was R26, while the year-on-year increase was R132. Assuming a family of two adults and two children, receiving two minimum wages and benefitting from child grants and school feeding schemes, buying the THFB would consume 30.3% of that family’s income. (The THFB is composed of a nutritionally balanced selection of 26 foods from all the food groups.)

The price increases have been driven in part by international factors and in part by local factors. International factors have been the main impellers of inflation for bread and cereals and dairy and cheese. Vegetable price increases have been largely driven by local factors such as excessive rainfall in December and January. Dairy and cheese prices were expected to stay high, but vegetable prices were anticipated to fall, over the coming months.