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Quarterly Food Price Monitor: February 2010
February 2010

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


The Consumer Price Index (CPI) report released by Statistics South Africa (Stats SA) in February 2010 indicates that food inflation fell below the lower limit of the South African Reserve Bank’s target inflation bracket. Inflation on food and non alcoholic beverages slowed down to 2.4% on a year-on-year basis (i.e. January 2009 to January 2010).

The period of high inflation is over for most countries; however, Turkey and Tanzania are still under pressure from high inflation. South Africa’s food inflation is higher than that of most developed countries.

Food commodity prices continued to decrease at a double digit rate. In general grain products experienced retail price decreases in both rural and urban areas during the 12-month period ending January 2010. However, in the rural areas, maize products experienced average increase in prices during the same period. In the urban areas, the inflation for dairy, fish, fresh and processed vegetables, fresh and processed meat, and other products slowed down from the figures reported in the November 2009 Food Price Monitor (FPM). In rural areas inflation also slowed for most food products.

The prices of food remain higher in the rural areas than in the urban areas. In January 2009, people living in rural areas had to pay R9.75 more than people in urban areas for food products monitored by the NAMC. The price difference increased to R17.49 in January 2010 fuelled mainly by rice, maize meal and sugar.

The cost of the food basket expressed as a share of the average monthly income of the poorest 30% of the population increased slightly from 33.2% in January 2009 to 33.4% in January 2010 while the cost of the food basket expressed as a share of the average monthly income of the wealthiest 30% of the population remained constant at 2.6% over the same period.

The farm-to-retail price spreads for full cream milk and low fat milk increased between January 2009 and January 2010. During the same period, the farm value shares of the two products decreased.

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