Groceries up 50% over a year

Amid warnings about rising costs of petrol and red meat, price checks show that a basket of basic goods has risen about 50% in the past year.

The prices in the basket compiled by the Saturday Dispatch and priced at one popular supermarket in East London show that between April last year and this year, the items went up from R136 to R204.

SA is still in the grips of a crippling drought, and consumers are being urged to budget strictly in the face of major hikes in food prices and another petrol price increase of 18c/l.

Economists are predicting a minimum 50% hike in the price of red meat because of the drought.

However, outspoken Eastern Cape farmer Richard Armstrong has accused retailers of refusing to drop meat prices although farmers are selling their livestock at lower prices.

The Red Meat Producers Organisation’s CE Gerhard Schutte said Armstrong was “100% correct”.

Saturday Dispatch asked the manager at the supermarket to compare prices over the year for a litre of milk, two litres of cooking oil, a loaf of brown bread, 2.5kg of maize meal, 60 eggs and a kilogramme of tomatoes. He said:

• A kilo of tomatoes which cost 7.99/kg last April now sells for 17.99/kg, an increase of 125%;
• A 2.5kg packet of maize meal was R15.99 and now sells at R25.99, a 62% increase;
• Two litres of cooking oil was R27.99 and currently costs R39.99 (42%);
• One litre of milk which cost R7.99 is now around R11.99;
• Five dozen eggs increased from R64.99 to R95.99 and;
• A loaf of bread went up by R1.

The manager of Ashmel Spar in Berea, Tonderayi Marvelous Chishaya, said suppliers had no choice but to increase prices when producers increased theirs.

“Otherwise we will be running at a loss,” he said.

Chishaya said retailers did not make much profit on basic food items.

“The profit we make on these items ranges from 10% to 18%. We also ensure that our prices are competitive with other retailers,” he said.

Experts have blamed the major food price increases on the ongoing drought and the weak currency, which was hammering South Africa’s food producers, who are under pressure to keep prices low.

Earlier this year Nigel Connellan, managing director of Western Gruppe Trading, which runs 13 Spars in East London and Gonubie, said maize product suppliers had hit them with an immediate 15%-20% hike in the first days of January. He said:

• The price of White Star maize meal, a staple for most consumers and one of the biggest sellers in the Eastern Cape, had increased by 20% on February 1, while Tiger Brands and Premier maize products had increased by between 8% and 10% on January 18; and
• Sugar giant Huletts increased its price of sugar by 14% on February 3.

Sundale Free Range Dairy, one of the largest private dairies in the Eastern Cape producing fresh milk, said the prolonged drought had placed the agri-sector in crisis.

Sundale CEO Pierre van Rensburg said: “Dairy farmers have received lower milk prices because of non-market related price cuts, and producer prices have had to increase significantly to avert a disaster and to guarantee the sustainability of milk production.”

He said Sundale had to increase the price they paid farmers as part of their drought relief initiative.

“We feel that it is responsible business practice to provide some kind of assistance at this difficult time,” said Van Rensburg.

Meanwhile, cash-strapped consumers say they have no choice but to cut down on not-so-necessary food, and prioritise the basics.

“Some fruit is just too expensive. We will have to stick to the cheaper kinds,” said Naomi Swarts from Southernwood.

Others are even considering changing their diet.

“This means no more red meat for me,” said Andrea Sauls from Cambridge West. — arethal@dispatch.co.za