Food prices likely to spike despite improving power supply, fuel costs

THE Competition Commission has offered a glimmer of hope with its latest Essential Food Price Monitoring (EFPM) report, saying that although lower load shedding indicates some respite in consumer costs, the relentless rise in food prices posed a significant threat to local security.

- BANELE GININDOZA

This has raised questions about the economic stability of many South Africans.

The commission’s report released on Thursday highlighted various cost pressures that are still plaguing producers and consumers alike.

Ongoing loadshedding, persistently high transportation costs, and the lingering effects of drought continue are all poised to compound the challenges facing South Africa’s food chain.

As producers attempt to cushion themselves against these harsh realities, the fluid grocery market remains marked by significant consumer behaviour.

Four of the EFPM report noted that many shoppers were swapping out costly items for more affordable protein sources such as choosing canned pilchards over chicken.

Competition Commission economists, Xhalirendwe Ranyanehi and Kwazi Zwana elaborated on the findings, indicating that while price spreads across food value chains appeared to be stabilising after a period of volatility, consumers still perceived current prices as high, exacerbated by months of elevated inflation.

Ranyanehi said since the monitoring of prices, there had been improvements as producers and retailers became increasingly adjusting prices, a difference from past practice where a benefit to consumer due to producer reduction were not passed to the consumer as quickly.

“The reason we started this was because we wanted retailers and producers called them quickly.