In July 2022, South Africa’s consumer food price inflation accelerated by 10,1% y/y, from 9,0% y/y in the previous month. This is the fastest pace since January 2017, which was a drought period in agriculture where costs were driven by higher agricultural commodity prices.
We are in a period of elevated prices, and food is at the core of these increases. For example, in May 2022, South Africa’s consumer food price inflation accelerated to 7,8% y/y, from 6,3% in the previous month. This is the quickest pace since March 2017.
Since the Russia-Ukraine war began four months ago, food security has dominated global media headlines. While prices of food products are rising globally, not all countries are negatively affected the same way.
The data released by Statistics South Africa this past week showed that the country’s consumer food price inflation decelerated to 6,3% y/y in April 2022 from 6,6% y/y in the previous month. This is on the back of relatively softer price increases in meat; milk, eggs and cheese; and vegetables.
The recently released data by Statistics South Africa showed that the country’s consumer food price inflation moderated to 6,6% y/y in March 2022 from 6,7% y/y in the previous month.
We now expect South Africa’s consumer food price inflation to increase modestly from readings in recent months and possibly average 6,0% y/y in 2022.
A recent survey done by Grain South Africa show that farmers in the Free State, Mpumalanga, North West, Limpopo, and KwaZulu-Natal ranked excessive rains as their biggest risk to crops this year.
Food prices often dominate the headlines in South Africa this year. On several occasions this year, some people questioned the rise in South Africa’s consumer food price inflation in a year of abundant agricultural harvest.