Is it not too soon to be considering food price increases in South Africa?
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South Africa indeed transports much of its agriculture and food products by road. For example, 80% of South African staple grain products are transported by road. We see similar volumes in other commodities.
Agricultural products are also processed in certain regions and then transported to various consumption points. This means that fuel price changes affect food prices through adjustments in distribution costs.
Still, such fuel price changes in some products take a while to be passed through. Therefore, any sudden worry or urge to adjust prices is something to watch closely.
There is still a lot we don’t know about this Middle Eastern war, including how long it will last. Indeed, all indications point to a potential notable increase in fuel prices this coming month.
Still, it is probably fair to assume that we won’t see a sudden jump in most food products, as there are various adjustments the many role-players have to make and time lags.
I typically don’t encourage unnecessary close monitoring of food price adjustments, but if we continue to see such headlines, it may be useful to pay attention to these things. We are already seeing worrying price increases in farm inputs in some regions of our country.
Agricultural products are also processed in certain regions and then transported to various consumption points. This means that fuel price changes affect food prices through adjustments in distribution costs.
Still, such fuel price changes in some products take a while to be passed through. Therefore, any sudden worry or urge to adjust prices is something to watch closely.
There is still a lot we don’t know about this Middle Eastern war, including how long it will last. Indeed, all indications point to a potential notable increase in fuel prices this coming month.
Still, it is probably fair to assume that we won’t see a sudden jump in most food products, as there are various adjustments the many role-players have to make and time lags.
I typically don’t encourage unnecessary close monitoring of food price adjustments, but if we continue to see such headlines, it may be useful to pay attention to these things. We are already seeing worrying price increases in farm inputs in some regions of our country.
