Food: platteland hit hardest

Cape Town - The difference between the price that country dwellers pay for a basket of food and what city dwellers pay continues to widen.

In July 2008 it cost country dwellers R8.03 more to buy a particular basket of food than it cost city dwellers.

In July this year the gap increased to R16.72.

In July this year the only items that were cheaper in the country than in urban areas were white bread, brown bread and tea.

These figures are reported in the latest food-price monitor from the National Agricultural Marketing Council (NAMC). They correspond with Statistics SA's latest available inflation numbers, which indicate that the consumer price index for food was 8.3% in July compared with 10.7% in June.

In its report the NAMC says that South Africa does not compare unfavourably with the rest of Africa when one looks at food inflation but, compared with developed countries, the picture is less rosy.

Botswana's food inflation reached 15.3% in June and that of Tanzania 16.9% in July. Turkey's food inflation in July was at almost the same level as South Africa's, namely 8.5%.

But in Brazil food inflation over the same period was running at only 2.2%, in the US 1.1%, and in the United Kingdom 4.1%.

The NAMC says the prices of food commodities are falling globally, as in South Africa, where the wheat price fell 37.29% between July 2008 and July 2009, that of maize 31.83% and sunflower seeds 45.92%.

As a result the inflation rate of products derived from these commodities also began to come down on store shelves. Inflation on wheat products had risen to 15.57% between April 2008 and April 2009. It dropped to 0.12% between July 2008 and July 2009.

Even the rate at which fish prices had been rising in urban areas slowed, while price reductions on pilchards were recorded in country areas.

Rising food prices nevertheless left their mark on households' disposable income.

The average household in the category of the 30% poorest households had to spend 29%-odd of their monthly income on a particular basket of food in July 2008. Higher food prices over the past year have led to these households now having to part with 33% of their monthly income for the same basket of food.

The affluent part of the population hardly noticed the rise in food prices. In July 2008 the basket cost the average household in the category of the top 30% of income earners about 2.3% of their income, and in 2009 this rose to 2.6%.

- Sake24.com

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