The latest research from the Pietermaritzburg Economic Justice and Dignity Group (PEJDG) shows that food prices rose by 17% over the course of 2020, spiking much higher than inflation for the year.

In December 2020, the total price of a basket of food to feed a family in a month was at R4,002.42, marginally lower than the same basket in November (R4,018.22).

However, when comparing a like-for-like basket of goods between December 2020 and December 2019, a family would be paying almost R520 more.

Worryingly, the price hikes are being driven by a number of staple and ‘core’ foods in the basket. These are food items which are purchased first by most families in South Africa, which take priority over more ‘luxury’ items.

Here, items like sugar beans, rice, bread and flour have seen price hikes between 31% and 68%. Fresh fruit and vegetables – necessary for a nutritionally complete diet – have also seen major price increases.
Very few items tracked by the PMBEJD saw actual price decreases over 2020 – only seven items in the basket.

Salt saw the biggest price drop (over 20%), with meat products like chicken pieces, gizzards, beef and polony also bringing some relief to the bill.

The PMBEJD’s research comes in the context of millions of South African households that are still struggling through the Covid-19 pandemic and the long-lasting effects of the national lockdown implemented almost a year ago to combat the spread of the virus in the country.

The lockdown decimated South Africa’s economy and led to record levels of unemployment and businesses closures in the country – while government aid and stimulus have been severely lacking.

Special social grants and the UIF TERS payments have slowly faded, leaving millions of South Africans without money to get by.

The PMBEJD’s basket of 44 food items is what households in low-income areas have identified as necessary to feed their families in a month.

At R4,000, this is far higher than what a single-income family on minimum wage (R3,500) could afford, and is out of reach of the 30.4 million people (55.5% of the population) who are living below the upper-bound poverty line of R1,268 per month.

The data also shows that the reality of food prices off the shelves do not exactly meet up with inflationary movements tracked by government agencies like Stats SA.

Inflation
Statistics South Africa published its latest consumer price index in December, showing that annual consumer price inflation was 3.2% in November 2020, down from 3.3% in October 2020.

The main contributors to the 3.2% annual inflation rate were food and non-alcoholic beverages, housing and utilities, and miscellaneous goods and service, the statistics body said.

“Food and non-alcoholic beverage prices continued to climb, recording an aggregate annual increase of 5.8%, up from 5.4% in October. Food inflation contributed one percentage point to November’s headline rate of 3.2%.”

Some of the largest annual price increases (November 2019 vs November 2020) were recorded for the following goods and services:
  • Fruit (14.5%)
  • Sugar, sweets and desserts (9.3%)
  • Oils and fats (8.3%)
  • Primary and secondary (7.5%)
  • Books, newspapers and stationery (7%)
  • Meat (6.6%)
  • Hot beverages (6.2%)
  • Milk, eggs and cheese (6%)
  • Vegetables (6%)
  • Water and electricity (6%)
Source: https://businesstech.co.za