Markets and Economic Research
Centre
Food Basket Price Monthly
Issue 3 - March/2016
FOOD BASKET PRICE MONTHLY
March 2016
1. Introduction
The NAMC monitors food prices at retail level and releases regular authoritative reports. The Department
of Agriculture, Forestry and Fisheries established the Food Price Monitoring Committee (FPMC) at the
NAMC to track and report on food price trends in South Africa and also to provide explanations on the
observed trends and advise the department on any possible action that could be taken when national and
household food security is threatened. The FPMC was established after the high food price episode of
2000/01 season. The functions of the FPMC were assumed by the NAMC after the FPMC completed its
work in August 2004. The NAMC issues four quarterly Food Price Monitoring Reports annually and, since
2005, also publishes an annual Food Cost Review, which documents the margins between farm prices and
retail prices of the major food products, among other topics. In 2015, the NAMC began releasing a quarterly
Farm-to-Retail Price Spread (FTRPS) publication, which seeks to provide more insight into the factors
driving commodity and food price margins. This publication, the Food Basket Price Monthly Report, is a
result of recent discussions with industry, and the need to keep watch on the movements of food prices on
a more regular basis than the current quarterly Food Price Monitor.
2. Overall inflation and food inflation
In February 2016, the Consumer Price Index (CPI) released by Statistics South Africa (StatsSA) indicated
that the headline CPI and the food and non-alcoholic beverage price indices were 7.0 % and 8.6 %,
respectively, compared to the 6.2 % and 6.9 % in January 2016. Figure 1 shows trends of the headline CPI
and food and non-alcoholic beverage inflation rates on a monthly basis, from January 2010 to February
2016.
Percentage (%)
12
10
8
6
4
2
Food and non-alcoholic beverages
Headline CPI (year-on-year)
Figure 1: Headline CPI and food and non-alcoholic beverage CPI
Source: StatsSA, 2016
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
Jan-13
Oct-12
Jul-12
Apr-12
Jan-12
Oct-11
Jul-11
Apr-11
Jan-11
Oct-10
Jul-10
Apr-10
Jan-10
0
3. Comparison between urban and rural prices: February
2016
Table 1 compares prices of selected food items in rural and urban areas for February 2016. The food items
which showed the largest price differences between urban and rural areas in February 2016 were
margarine 500g at a R1.76 difference, sunflower oil 750mℓ at a difference of R0.59, Ceylon/black tea 62.5g
at a difference of R0.48, loaf of brown bread 700g at a difference of R0.39, and a loaf of white bread 700g
at a difference of R0.39.
Table 1: Comparison between urban and rural food prices (selected food items)
Rural Food Prices
Urban Food Prices
Price difference
Product
February 2016
February 2016
R/unit
Full cream milk – long life 1ℓ
12.63
12.63
0.00
Loaf of brown bread 700g
10.83
11.22
0.39
Loaf of white bread 700g
12.00
12.39
0.39
Special maize 2.5 kg
19.48
19.47
-0.01
Super maize 2.5 kg
22.82
22.78
-0.04
Margarine spread 500g
21.09
22.85
1.76
Peanut butter 400g
22.39
22.52
0.13
Rice 2kg
24.04
24.34
0.30
Sunflower oil 750mℓ
21.44
22.03
0.59
Ceylon/black tea 62.5g
11.42
11.90
0.48
White sugar 2.5kg
30.07
30.04
-0.03
Average
0.36
Source: StatsSA, 2016
4. The food basket of consumers1
This section is based on the cost of a basic food basket (as compiled by the Food Price Monitoring
Committee (FPMC) in 2003), based on monthly average food price data for the period February 2015 to
February 2016. Composition of the current food basket is as follows: Apples (1kg), Bananas (1kg), Beef
chuck (1kg), Brick margarine (500g), Baked beans - tinned (410g), Cabbage (1kg), Ceylon/black tea
(62.5g), Chicken portions - fresh (1kg), Chicken portions - frozen (1kg), Eggs (1.5 dozen), Canned fish
(excl. tuna) (425g), Full cream milk - long life (1ℓ), Instant coffee (750g), Loaf of brown bread (700g), Loaf
of white bread (700g), Maize meal super (5kg), Onions (1kg), Oranges (1kg), Peanut butter (400g),
Potatoes (1kg), Rice (2kg), Sunflower oil (750mℓ), Tomatoes (1kg). Due to data limitations butter beans
were substituted with tinned baked beans. From February 2015 to February 2016, the cost of this basic 22
item food basket (excluding oranges), increased by approximately R56 (+10.86 %)* in nominal terms from
R510 to R566.
1
Due to data limitations, oranges were excluded from this basket to calculate the Total Rand value of this 22 item basic food basket.
Table 2: Basic food basket (22 item) prices
Product
Baked beans - tinned 410g
Peanut butter 400g
Instant coffee 750g
Ceylon/black tea 62.5g
Full cream milk - long life 1ℓ
Eggs 1.5 dozen
Brick margarine 500g
Sunflower oil 750mℓ
Apples - fresh per kg
Bananas - fresh per kg
Beef chuck - fresh per kg
Chicken portions - fresh per kg
Chicken portions - frozen per kg
Fish (excl. tuna) - tinned 425g
Loaf of brown bread 700g
Loaf of white bread 700g
Super Maize meal 5kg
Rice 2kg
Cabbage - fresh per kg
Onions - fresh per kg
Potatoes - fresh per kg
Tomatoes - fresh per kg
Total Rand Value*
Source: StatsSA SA and BFAP, 2016
Feb-15
Jan-16
8.56
22.63
70.46
9.75
12.73
34.25
19.08
17.21
18.76
11.49
64.08
50.00
28.81
14.39
10.33
11.56
33.15
23.51
12.33
9.42
9.99
17.49
509.98
8.40
22.21
76.44
11.87
12.57
36.34
19.95
21.49
17.21
12.06
69.72
52.97
35.85
14.93
10.88
12.03
38.88
24.16
14.11
10.80
11.09
19.26
553.22
Feb-16
8.40
22.52
76.51
11.90
12.63
37.51
20.79
22.03
17.50
10.67
69.40
52.26
40.21
15.41
11.22
12.39
41.31
24.34
12.52
11.99
12.88
20.98
565.37
% change
y-o-y
-1.87%
-0.49%
8.59%
22.05%
-0.79%
9.52%
8.96%
28.01%
-6.72%
-7.14%
8.30%
4.52%
39.57%
7.09%
8.62%
7.18%
24.62%
3.53%
1.54%
27.28%
28.93%
19.95%
10.86%
% change
m-o-m
0.00%
1.40%
0.09%
0.25%
0.48%
3.22%
4.21%
2.51%
1.69%
-11.53%
-0.46%
-1.34%
12.16%
3.22%
3.13%
2.99%
6.25%
0.75%
-11.27%
11.02%
16.14%
8.93%
2.20%
*Note: The Total Rand Value (and therefore the y-o-y growth rate), excludes oranges as there was no data available for oranges
during the months of February 2015, January 2016 and February 2016.
The food basket products highlighted in Table 2 whose annual inflation rates that exceed the South African
Reserve Bank’s (SARB) inflation upper band of 6 % are: instant coffee 750g (8.59 %),
Ceylon/black tea
62.5g (22.05 %), eggs 1.5 dozen (9.52 %), brick margarine 500g (8.96 %), sunflower oil 750mℓ (28.01 %),
beef chuck – fresh per kg (8.30 %), chicken portions – frozen per kg (39.57 %), fish (excl. tuna) - tinned
425g (7.09 %), loaf of brown bread 700g (8.62 %), loaf of white bread 700g (7.18 %); maize meal 5kg
(super) (24.62 %), onions – fresh per kg (27.28 %), potatoes – fresh per kg (28.93 %), and tomatoes - fresh
per kg (19.95 %).
Nominal cost of food groupsin basic
food basket (R)
200
180
12.7%
Feb-15
Feb-16
160
140
120
13.6%
100
10.2%
80
18.6%
60
6.7%
40
-6.9%
-0.9%
Fruit
Bean
products
18.0%
20
0
Animal
protein
Bread &
Cereals
Coffee & Tea Vegetables Dairy & Eggs
Fats & Oils
Figure 2: Nominal monthly cost of specific food groups within the basic food basket, comparing
February 2015 to February 2016
Source: BFAP calculations, based on StatsSA monitored price data for urban areas, 2016
To further explore the impact of inflation on consumers, Figure 2 presents an illustration of the average
annual nominal cost of specific food groups within the basic food basket, for the period February 2015 to
February 2016. As could be expected, Figure 2 illustrates the dominance of vegetables, fats and oils,
breads and cereals and animal protein foods, within the cost of the basic food basket.
Readers of this document must be cognisant that the information in this report is based on the
official data released by Statistics South Africa. Due to the sensitivity of information contained in
this document, caution should therefore be taken in its interpretation in order to avoid any
misrepresentation.
Compiled by:
Trends and discussion on selected topics:
Rika Verwey
BFAP:
Hester Vermeulen
Enquiries: Christo Joubert: +27 12 341-1115
StatsSA is acknowledged for assistance provided to the NAMC in terms of food price data.
© 2016. Published by the National Agricultural Marketing Council (NAMC).
Disclaimer:
Information contained in this document results from research funded wholly or in part by the NAMC acting
in good faith. Opinions, attitudes and points of view expressed herein do not necessarily reflect the official
position or policies of the NAMC. The NAMC makes no claims, promises, or guarantees about the accuracy,
completeness, or adequacy of the contents of this document and expressly disclaims liability for errors and
omissions regarding the content thereof. No warranty of any kind, implied, expressed, or statutory, including
but not limited to the warranties of non-infringement of third party rights, title, merchantability, fitness for a
particular purpose or freedom from computer virus is given with respect to the contents of this document in
hardcopy, electronic format or electronic links thereto. Reference made to any specific product, process, and
service by trade name, trade mark, manufacturer or another commercial commodity or entity are for
informational purposes only and do not constitute or imply approval, endorsement or favouring by the NAMC.