The Bureau for Food and Agricultural Policy (BFAP) was founded in 2004. It serves the broader African, as well as the South African food system through an end-to-end value chain approach which considers land, water, the economy and its people as well as elements of the socio-economic environment, such as infrastructure, governance, social change and technologies.

Brief on October 2021 Stats SA food inflation - This report gives an overview of food inflation dynamics, its associated causes and the cost of basic healthy eating for October 2021.

SOUTH AFRICA’s SEASONALLY ADJUSTED GDP CONTRACTED BY 1.5% IN THE THIRD QUARTER OF 2021. A YEAR-ON-YEAR COMPARISON OF AGRICULTURE, FORESTRY, AND FISHERIES REFLECTS A CONTRACTION OF 7.2%, LARGELY DUE TO THE TIMING OF DELIVERY OF THE 2021 SUMMER CROP.

Since our previous inflation brief in November 2021, the identification of the Omicron variant, combined with excessive rainfall in the summer rainfall areas, has presented the possibility of further supply disruptions that could affect global and local inflation.

Agriculture, forestry & fisheries was South Africa’s fastest growing sector in 2020 and 2021.

Similar to January 2022, major drivers of food inflation internationally include high agricultural commodity prices, resulting from challenging weather conditions, supply chain disruptions and rising energy prices exacerbated by the ripple effects of the Russia-Ukraine war.

The Agriculture and Agro-Processing Master Plan (AAMP) was signed on 12 May 2022, bringing to a close an iterative process of research, discussions and negotiations between Government, Labour and Industry, that lasted more than two years.

SOUTH AFRICA’S SEASONALLY ADJUSTED GDP GREW BY 1.9% IN THE FIRST QUARTER OF 2022.

South African inflation on food and non-alcoholic beverages continued on an upward trajectory, reaching 8.6% in June 2022, mainly driven by price increases for meat (3.0 percentage points contribution), bread/cereals (2.1 percentage points), oils and fats (0.9 percentage points) and dairy/eggs (0.7 percentage points).

Inflation on Food and Non-alcoholic beverages continued to gain momentum in June 2022, with similar inflation levels last seen in March 2017. Food inflation was mainly driven by price increases in meat and breads/cereals, as well as plant oil products, dairy and eggs..

The BFAP Baseline is an annual event that presents a 10 year outlook for South African agriculture, agro-processing production, consumption, prices and trade. It considers the performance of South African agriculture and agro-processing and their contribution to inclusive growth and economic prosperity in the South African economy.

International overview

AGRICULURAL EMPLOYMENT HAS BENEFITTED FROM SUSTAINED JOB NUMBERS AND HIGHER WAGES IN THE PAST DECADE BUT WILL COME UNDER THREAT AS LABOUR-INTENSIVE FRUIT FARM INCOMES DECLINE AND COSTS CONTINUE TO SPIRAL.

According to the Statistics South Africa Living Conditions Survey 2014/2015, the least affluent 50% of South African households allocate approximately 35% of their food budget to starch-rich foods.

The recently signed Agriculture and Agro-Processing Master Plan (AAMP) has pinned the overarching policy direction on the widespread consensus for the need to promote meaningful participation by all players and stakeholders, whether small, medium, or large businesses in the agricultural value chain.

Food inflation drivers and expectations Although the overall inflation rate in South Africa has decreased over the past 6 months, albeit rather modestly, food inflation remains sticky.

In 2020/21, the total SA commercial white and yellow maize areas increased (compared to the 2019/20 season) with the total maize area increasing by an estimated 145 000 hectares.