The National Agricultural Marketing Council’s (Namc) 28-item urban food basket increased by 11.5% year-on-year.
The cost of the urban food basket increased by 11.5% in January from a year ago to reach R1 261.29, an increase of nearly 22 cents from the prior month, according to the Food Basket Price Monthly Report for February 2024 released yesterday.
This was up from the urban food basket of R1 239.59 reported in December last year.
The report was compiled by Namc’s Thulani Ningi, Corné Dempers and Dr Moses Lubinga.
“Between January 2024 and January 2023, among these 28 items, 17 witnessed price increases that exceeded the inflation target set by the South African Reserve Bank (SARB) of 6%. Notable products in this category include oranges, which experienced a substantial price surge of 43.7%, followed by potatoes (43.3%), brick of margarine (32.5%), Ceylon/black tea (30.5%), eggs (25.8%), rice (25.5%), white sugar (24.5%), instant coffee (22.7%), apples (22.0%), bananas (21.2%), peanut butter (15.4%), baked beans (15.0%), Cheddar cheese (12.8%), tomatoes (10.4%), dried beans (9.0%), chicken giblets (8.6%) and full-cream long-life milk (7.0%),” the report noted.
When examining year-on-year price differences, the food group that contributed most significantly to observed food inflation was fruits, experiencing a substantial increase of 29.8%. Following this was coffee and tea, which increased by 26.3%, sugary foods by 24.5%, dairy and eggs by 15.8%, bean products by 13.1%, fats and oils by 11.9%, vegetables by 9.6%, bread and cereals by 7.2%, and animal products by 2.7%.
When compared to the R1 239.59 in December last year, the monthly increase was 1.8%.
Reviewing the month-on-month basis, fats and oils showed the most significant escalation by 15.0%, followed by fruits which increased by 8.9%, coffee and tea by 1.3%, vegetables by 1.1%, bread and cereal and animal protein both increased by 0.8%, sugary foods by 0.6% and bean products by 0.3%, while during the same period dairy and eggs decreased by 0.7%.
The Food and Agriculture Organization (FAO) reported a decrease of 1.0% in the global nominal food price index for January 2024, down by 1.2 points from December 2023. This was attributed to decreases in different food categories included in calculating the food price index.
Meanwhile, Namc’s January 2024 Smallholder Market Access Estimate Report revealed that the total revenue generated by smallholder farmers from fruits and vegetables was R573 891 095.60, with a total mass of 74 710 tons.
This report, compiled by Namc’s Bernard Manganyi, Khathutshelo Rambau, and Phelelani Sibiya, aims to highlight the importance of policy recommendations that promote market access and transformation.
It noted that market access remained concentrated in major cities such as Johannesburg, Tshwane, Cape Town and Durban, limiting smallholder farmers’ reach and exposing them to volatile market dynamics.
“The dominance of a few commodities, including potatoes, tomatoes, onions, peppers, carrots, bananas, and apples, indicates a lack of diversity in the market, increasing vulnerability to price fluctuations and market saturation,” said the report.
One of the concerning trends the report highlighted was the month-on-month decline in prices for key commodities such as potatoes, onions, tomatoes, apples and bananas.
The authors said this trend could potentially reduce profit margins for smallholder farmers, who already faced challenges such as limited access to resources, infrastructure, and market information.
“To address these issues, stakeholders must consider expanding market channels to facilitate access to regional and national markets, supporting diversification efforts through technical assistance and financial support and investing in infrastructure such as storage facilities, transportation and networks,” it said.
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