Soaring food prices to affect your pocket

With the drought affecting food provision around the country and the weakening Rand adding to the issue, consumers will soon have to dig a lot deeper into their pockets than expected.

This will affect the low-income households severely, as they are already spending more than half their monthly income on food, according to the Pietermaritzburg Agency for Community Social Action (Pacsa).

“The implication of substantial food price inflation in 2016 is set to exacerbate the already severe affordability crisis facing households that are already under enormous financial strain.

“This reality suggests massive ramifications for health and well-being, child development, productivity, education, health and economic outcomes, family functioning and social solidarity, and civil discontent and protest.

“High food prices, together with Eskom’s request for a 16.6 per cent increase in electricity tariffs, the exponential water tariff increase, increased interest rates and excessive levels of indebtedness may have disastrous implications for the South African society,” Pacsa said.

“We are moving from crisis to crisis, and shock to shock; these are a direct consequence of our current economic paradigm.

“We cannot address our challenges within this paradigm; we need to seriously explore a new economic paradigm that can afford each person a life of dignity,” the press release reads.

The substantial month-on month increase for the latest December 2015 to January 2016 food price data is eight times higher than the average monthly increase over the preceding 12 months.

Although this information is based on the KwaZulu-Natal region, it is a situation that is affecting everyone in the country.

The Ridge Times spoke to one of the big food wholesalers in the area.

The manager, who prefers to stay anonymous, said it will definitely affect business.

He said consumers have already cut down on luxuries and commodities.

Toys, flowers and accessories were items that sold last year, but in the last two months hardly anyone can afford it.

“The effect of the drought will hit consumers and suppliers hard in the winter months.

“Where wholesalers normally outsourced for food products locally, they will have to travel further to buy supplies when the food provision in the area gets scarce.

“If wholesalers do not make their targets in the first quarter of the financial year, they will have to severely increase the food prices when the second quarter takes effect in September,” he said.

The local basket price for 10 items was R85 in February last year, but almost doubled to R150 in February this year.