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Persistent inflationary pressures reflected in most produce items
Farmer's Weekly
|Farmer's Weekly 3 February 2023
Numerous challenges, ranging from rolling blackouts to adverse weather conditions, have beset South Africa's fresh produce sector since late last year. Absa AgriBusiness examines these market dynamics in detail.
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An increase in the frequency and intensity of rolling blackouts having a negative impact the production and distribution of fresh produce in South Africa, with irrigation, packaging and cooling functions all severely affected.
During December 2022 and early January this year, planting and harvesting in some parts of the country were also affected by heavy rainfall.
In addition, industry stakeholders have reported that the slowdown in post-festive-season demand has been more apparent this year due to broad-based and persistent pressures on consumer income. These include high fuel and food costs, and rising interest rates.
The month-on-month (m/m) and year-on-year (y/y) price increases for most of the products included in this report are likely to have contributed to food inflationary pressures for January.
CABBAGES
Market stakeholders reported that the quality of cabbages was poor during December due to heavy rainfall and hail damage. As usual, however, there was a slump in demand for this fresh produce over the holiday period.
In mid-January, the price of cabbages was up 21,3% m/m, despite a 13,8% increase in volume (see Graph 1).
This points to improved demand and quality, with drier conditions prevalent throughout the month.
The price rose by more than 62% y/y as a result of a 10,4% contraction in volume.
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