Escaping the commodity trap

Statistics show that, due to inflation, people are spending less on buying fruit,

- Glenneis Kriel.

The rise of discounters and retail price wars has resulted in a situation where consumers benefit from lower prices at the expense of producers, said David ‘Dr Food’ Hughes, an emeritus professor of Food Marketing at Imperial College London, at the 10th International Table Grape Symposium, held in Somerset West in the Western Cape.

Hughes said the retail wars were driven by the impact of rising costs on consumer spending and the polarisation of household income, which had accelerated over the past five years throughout the world.

In the US, for instance, it is estimated that households at the bottom 20% of income spend roughly 37% of their salaries on food, in comparison with only 7% for the top 20%.

According to Statistics South Africa, the situation is worse in South Africa, with the poorest households spending roughly 50% and those in the middle class roughly 34% of their income on food and non-alcoholic beverages.

The pressure is having an impact on consumption patterns.