Food Inflation Bludgeons South African Household Budgets


The fluctuating cost of food has been making budgeting very tough for everyday South Africans, learn why and discover some cost-saving tips.

The South African economy has gone from bad to worse lately. Years of economic instability, debts (both national and personal) and escalating political uncertainty have at long last resulted in the country’s credit rating being downgraded to junk status by S&P.

With petrol prices at uncomfortably high levels, electricity costing more, the cost of credit rising and the Rand particularly weak against the dollar, 2017 has not been an easy ride for everyday South Africans in terms of their finances. Particularly for individuals and households who were already struggling to make ends meet.


Food prices skyrocket

One of the biggest financial burdens affecting household finances in real terms over the past 12 months has to be the cost of food. Food inflation sky-rocketed towards the end of 2016, which meant that budgets went less far in the grocery store and the supermarket. The trend carried over into 2017, too. The PACSA food basket (which monitors the cost of a selection of nutritionally necessary products) found that between January 2016 and January 2017, prices rose by 16.5%. In real terms, that’s a hike of R295.21.

Food inflation has affected a very wide range of products in the country in recent months, causing 31 out of 36 key foods across all categories to increase in price. Many crucial basics have been hit by price hikes including maize meal (up by 36% thanks to a national drought), white sugar (up 32%), fresh milk (up 18%), chicken pieces (up 34%) and rooibos tea bags (up 22%).


Serious strain on household budgets

These increases may be a drain on household finances for some, but for others already struggling with the cost of living, they could be very serious indeed. In 2017, the Child Support Grant’s annual increment was R30 (9.1%) while the rise in the cost of a nutritionally balanced, healthy diet for a child rose by 11.6%, making it ever-harder for low income families to provide a nutritionally complete diet for their youngsters.


The big picture

So what’s behind food inflation? 2016’s serious drought (the worst in 30 years) has played a major role in the increased cost of food by forcing the country to import ingredients it previously grew cheaply and domestically. The depreciation of the Rand has exasperated the problem, sending the cost of importing goods through the roof, resulting in even more significant food inflation.

While many believe levels will continue to drop throughout 2017, households must be smarter than ever about food and finance to stay in the black. These tips could help combat the effects of food inflation:


  • Buy “own brand” products
    Generic, un-branded products typically taste just as good (sometimes better!), while costing far less than well known brands.


  • Plan in advance
    Don’t decide what to buy in the supermarket. Create a watertight meal plan for each night of the week, ensuring nothing goes to waste, before writing a list and making your precise purchases.

Has food inflation affected your household budget? How are you handling the higher cost of food? Share your experiences and tips with other readers below.