Durban: After a record-breaking hike in the price of petrol and diesel earlier this month, South Africans have to brace themselves for sharp increases in the price of food.
This week, the Transvaal Agricultural Union of South Africa (TLU SA) warned that higher prices for fuel and fertiliser were making it more expensive to farm, and these costs would have to be recovered from consumers.
Benny van Zyl, the general manager at TLU SA, said a recent report by Grain SA showed that fertiliser prices were currently at record high levels. Fertiliser accounts for about 30 to 35% of the maize farmer’s costs in producing the crop.
Van Zyl said the price of seeds also increased.
“According to Grain SA's calculations, maize seed prices for some of the most popular cultivars have increased by an average of 5.6% since last year, while the average of all the maize cultivars has increased by about 3.3%. Sunflower seed prices increased by an average of 3.7%, while soybean seed prices increased by 2.6%.”
What this means, according to Grain SA, is that the maize and maize related products will go up just under 30%.
Meanwhile, the price of potatoes is also expected to increase. According to Potatoes South Africa, prices will rise by about 30%.
Nazneen Rahman, a fruit and vegetable seller in Chatsworth, said she was already paying almost double for a 10kg pocket of Up to Date (UTD) potatoes compared to previous months.
“Because these are first-grade potatoes, you do expect to pay a little more compared to second grade. However, we are now paying between R190 to R195 for a 10kg pocket. Previously, we used to pay between R70 and R100, depending on the size.
“We cannot increase our mark-up by much because we will lose customers, so we are settling on a profit of about R20. But this barely covers our fuel costs, which have also shot up.”
Joy Pillay, another vegetable seller in Chatsworth, said there was a significant increase in the price of other vegetables, including green beans and coriander (dhania).
“We pay anything between R200 and R300 for a box of green beans or gadra beans. We previously paid about R100 or R150 a box. We have to now sell them at R25 or R30 a kg, but customers find it expensive.
“We have to explain that cost prices have increased, and we have to charge more to meet our accounts. But, it is hard for everyone to understand as many are struggling to make ends meet.”
Kulani Siweya, an agricultural economist at Agris-SA, an agricultural industry association, said the recent fuel price was bad for farmers because it pushed up the cost of producing food.
“This is also exacerbated by the fact that there are other cost-push pressures, like fertiliser costs and electricity costs.”
He said for farmers, fuel generally accounted for about 13% of production costs, particularly in grains and oilseed production.
“The continued rise in costs puts pressure on the farmers and is worrying as we have entered the planting season for the summer crops and consumption of diesel is high during this period.
“Furthermore, 75% of grains and oilseed are transported by road, after being harvested, so the cost of transporting and distribution also becomes expensive.”
Siweya said the association expected to see prices in the big retail stores rise.
“This may come as a result of retailers charging more to account for the higher transportation and distribution costs that come with the continued fuel hikes and other factors.”
Siweya said the association expected meat prices to remain high ahead of the festive season.
“This is because of strong demand that comes with the festive season as well as lower slaughter numbers and rising world prices. Chicken prices have also remained high as a result of strong global prices, and the trend may continue, supported by local demand in the month ahead,” he said.
Rosheda Muller, the national president of the SA Informal Traders Alliance (SAITA), said the alliance they were concerned escalating costs would compound the impact on the financial position of households, increasing the risk of food insecurity and the affordability of basic foodstuffs.
“We all know that once food prices have gone up, they almost never go down again. We call on the government to intervene by implementing a plan that addresses the rising cost of food.”
Mervyn Abrahams, a programme co-ordinator at the Pietermaritzburg Economic Justice & Dignity Group (PMBEJD), said those most at risk were people already living below the poverty line.
Based on their research, the average household food basket cost about R100 more month on month and about R400 more compared to the same time last year.
“In October 2021, the average Household Food Basket cost R4 317.56. This is well beyond what most South African workers earn and certainly much higher than the money that would be available to be allocated for other costs. This includes transport, electricity, alternative costs due to load shedding, and debt repayments.
“The cost of the household food basket is very high, and families can’t afford it. We remain in an emergency food crisis that is only going to deepen. Our problem is not only that we are going hungry, but what is on our plate when there is food.
“The higher cost of foods has emptied out the trolleys of any nutritional diversity. Women tell us that ‘whatever we have got, we eat. It doesn’t matter anymore, as long as we can eat it’. However, we will pay a very high price for not making proper nutritious food for our children a key political priority,” he said.
Abrahams said one of the ways the government could address the rising cost of food was to look at ways to cut the cost of transporting food.
“South Africa’s railway system is crumbling, and more of our goods and services are being transported by road. This requires the use of fuel, yet rail is a cheaper option.”