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Quarterly Food Price Monitor: February 2011
February 2011

Acknowledgements: FANRPAN acknowledges National Agricultural Marketing Council (NAMC) as the source of this document


The January 2011 Consumer Price Index (CPI) released by Statistics South Africa (Stats SA) showed that food and non-alcoholic beverages inflation was 3.1 % between January 2010 and January 2011. Headline CPI was 3.7 % between January 2010 and January 2011. Both headline CPI and the food and nonalcoholic beverages index increase from December 2010 to January 2011, the headline CPI increased by 0.4 % and the food and alcoholic beverages index increased by 2.2 %. The annual increase of 3.1 % in the food and non-alcoholic beverages index was largely driven by the annual increases in oils and fats (11.6 %), meat (6 %), fruit (5.8 %) and sugar (5.6 %).

The domestic price of wheat increased by 37 % between January 2010 and January 2011 and the price of sunflower seed increased by 58 %. International wheat prices increased by 58 % during the same period. The domestic price of white maize showed a decrease of 5 % for the period January 2010 to January 2011. The domestic price of yellow maize decreased by 0.07 % year-on-year; while the international price of yellow maize followed the same trend as the other international grain prices by showing an increase of 57.5 % for the period January 2010 to January 2011 due to low world stock levels. The impact of the strong exchange rate and the fact that South Africa has surplus maize is clearly evident in local maize price trends as compared to the trends internationally.

South Africa4s food inflation compared favourably with that of the so-called BRIC countries (Brazil, Russia, India and China). These countries all experienced food inflation of higher than 10 %. The overall global food price index increased by 33 % from January 2010 to January 2011, reaching its highest level since January 2008.

In January 2011, rural consumers paid R17.55 more than urban consumers for the same food basket, a 9 % increase from the R16.12 price difference reported for October 2010 in the November 2010 Food Price Monitor. In January 2011, rural consumers paid R2.66 more than urban consumers for maize meal (5kg), which is significantly lower than the R6.16 price difference reported in January 2010. A loaf of white bread is the only food item for which rural consumers paid less than urban consumers in January 2011.

The cost of the food basket, expressed as a share of the average monthly income of the poorest 30 % of the population, increased from 33.4 % in January 2010 to 33.9 % in January 2011. When comparing the costs associated with the typical portion sizes of very poor consumers for the five most widely consumed food items in South Africa, based on January 2011 versus January 2010 prices, there was significant inflation of about 10.4 % (from R3.11 to R3.44).


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