Brace yourselves for another food price hike in the next few months due to the recovery in meat prices.
Statistics SA released data on Wednesday that reflects that food prices stagnated at 2.3% for four months by increased to 2.8% year-on-year in May.
The effect may not be felt immediately by consumers and were based across the food basket but did not affect fruit, vegetables and sugar prices.
Agbiz chief economist, Wandile Sihlobo said that the rate of food prices is at it’s lowest this year, since it’s peak at 12% in 2017 but over the next few months could rise at a faster pace.
The Bureau for Food and Agricultural Policy’s said that beef exports had dropped to 4,000 tons in the first quarter, compared to the same period in 2018 where it was 6,600 tons.
There was a slight increase in March when 1,790 tons were exported and Sihlobo said they expect meat exports to make a recovery in the next few months, which will reduce the cost of meat.
Food price inflation during 2017 was due to the 2015-2016 drought but good maize harvests in 2017 assisted with the recovery in agricultural production and inflation decelerated.
Recent food price increases were driven by the increase in grain-related products following the dry weather conditions across the country which resulted in a poor harvest.