South African food inflation continued a downward trend in April

27th May 2024 By: Rebecca Campbell - Creamer Media Senior Deputy Editor

In April, for the second month in a row, year-on-year (y-o-y) South African food and non-alcoholic beverage (NAB) inflation (hereafter to be referred to as food inflation, for short) ran at a rate below that for consumer price index (CPI) headline inflation, the Bureau for Food and Agricultural Policy (BFAP) has reported. April was also the fifth consecutive month which recorded a decline in food inflation. The food inflation rate in April was 4.7%, while that for CPI headline inflation was 5.2%. Food inflation contributed 0.9 percentage points to CPI headline inflation in April. (Y-o-y food inflation in March had been 5.1%.)

In month-on-month (m-o-m) terms, food inflation in April was 0.2%, whereas CPI headline inflation was 0.3%. Food inflation contributed zero percentage points to the m-o-m headline figure.

For the first time in many months, the BFAP did not list loadshedding (scheduled rotating power cuts) as an infrastructural challenge for South African agriculture. Instead, it listed municipal services challenges and port challenges. Other external factors affecting the sector were the CPI index for electricity and other fuels (up 15.3% y-o-y, but by zero percent m-o-m) and fuel (a 9% y-o-y increase, and also up m-o-m, by 1.9%). The rand continued to depreciate against the dollar in April, by 3.8%, y-o-y, from R18.18/$1.00 in April last year to R18.88/$1.00 this past April.

The food categories with the highest y-o-y inflation in April were sugar-rich foods (16.8%), dairy and eggs (8.7%), vegetables (7.4%), NAB (7.3%), fruit (4.5%), bread and cereals (4.3%), fish (3%) and meat (0.5%). Oils and fats registered y-o-y deflation of -4.9%. The highest m-o-m inflation was experienced by vegetables (3.6%), NAB (0.6%) and dairy and eggs (0.2%). Sugar-rich foods had zero percent m-o-m inflation. M-o-m deflation was recorded for fish (-0.1%), bread and cereals (-0.2%), meat (-0.3%), oils and fats (-1.1%) and fruit (-1.6%).

Regarding y-o-y inflation, and in the order and categorisations given by the BFAP, the commonly purchased food items with rates equal to or higher than 30% in April, were rice and papaya. Those with rates from 20% to just under 30% were potatoes, instant coffee, condensed milk, white sugar, and whiteners. Those with rates from 10% to just under 20% were oranges, avocados, apples, pineapples, pears; sweet potatoes, broccoli; eggs; whole fresh chicken; frozen hake, frozen fish fingers; peanuts, peanut butter and dried beans. Those that experienced y-o-y deflation in April were brown bread, pasta, breakfast cereals, white bread, maize meal; mutton/lamb (neck, stew, rib chop, leg); beef (stew, brisket, chuck, T-bone, mince, rump steak, sirloin, fillet); pork (bacon, ribs, chops); cauliflower, canned mixed vegetables, spinach, lettuce, carrots, beetroot, pumpkin, sweet peppers; fresh cream, cheddar cheese; and, plant oil.

The cost of the BFAP’s Thrifty Healthy Food Basket (THFB) in April was R3 812. This represented a y-o-y increase of R366, or 3.6%. In m-o-m terms, the increase was R31, or 0.8%. The THFB is composed of 26 nutritionally balanced food items from all the food groups and is designed to feed a family of two adults, one older and one younger child, for a month. In April, the THFB would have cost a poor family 30.7% of its income, which was slightly worse than the case in March this year, when it would have taken 30.6% of their income.