Food prices fell in December, a welcome sign after a long period of upward pressure. Statistics SA said yesterday food prices at the farm level were down 0.5 percent month on month and down 0.1 percent at the factory level.
As a result of the monthly deflation, the annual increase in the food components of the producer price index dropped from 11.1 percent in November to 9.2 percent in December (factories) and from 5.9 percent to 3.2 percent (agriculture).
At the farm level, grain prices fell the most: 6.9 percent in the month and nearly 3 percent in the year. Manufacturing prices fell 0.5 percent in the month but rose 7.6 percent over 12 months. The price relief is part of a global pattern. The index compiled by the UN’s Food and Agriculture Organisation averaged 209 in December, down two points (1.1 percent) from November and the lowest since June 2012, when the index stood at 200. – Ethel Hazelhurst