Household food basket prices increase again

The household food basket prices have increased again in July, while consumers now also have to pay more for electricity, while the rising fuel prices will also force them to pay more for transport soon. This is not good news for cash-strapped consumers as global food prices increase on the back of Russia stopping grain exports from Ukraine.

Key data from the July 2023 Household Affordability Index based on food price data from 47 supermarkets and 32 butcheries in Johannesburg, Durban, Cape Town, Pietermaritzburg, Mtubatuba in northern KwaZulu-Natal and Springbok in the Northern Cape shows that the average cost of the basket was R5 081.94 in July, R25.48 (0.5%) more than in June when it cost R5 056.45 and R333.07 (7.0%) more than in June 2023 when it was R4 748.87.

The Pietermaritzburg Economic Justice and Dignity Group designed the food basket that contains 44 food items with women living on low incomes and includes the foods and volumes women living in a family of seven members, an average low-income household size, say they typically try and buy every month.

The women check the prices at supermarkets and butcheries that target the low-income market where they shop near their homes. The food selection mirrors how the women themselves make decisions at the supermarket shelves given affordability constraints compared to the foods chosen on relative affordability and reasonable quality.

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Food items with the biggest price increases

Food items that cost 5% or more in July include white sugar that increased by 7%, salt (5%), potatoes (8%), curry powder (6%), eggs (5%), beef liver (6%), fish (7%), butternut (14%), green pepper (9%), cremora (5%), apples (5%) and polony (5%).

Foods that increased in price in July by 2% or more, include maize meal (2%), cake flour (4%), sugar beans (4%), soup (2%), tea (2%), full cream milk (4%), amasi [maas] 3%, gizzards (2%), chicken livers (2%) and peanut butter (3%).

According to Statistics SA’s latest Consumer Price Index for June, headline inflation was 5.4%, while it was 9.1%, 8.6% and 7.6% respectively for the lowest expenditure quintiles 1-3. Food inflation was 11.1%.

The price of the food basket increased in Johannesburg and Cape Town in July and decreased in Durban, Springbok, Pietermaritzburg and Mtubatuba.

• The Johannesburg basket increased by R118.57 (2,4%) compared to June and by R380,.02 (8,0%) compared to July 2022.
• The Cape Town basket increased by R70.32 (1.4%) compared to June and by R406.53 (8,7%) compared to a year ago.
• The Durban basket decreased by R54.27 (-1,1%) compared to June and increased by R169.79 (3.5%) compared to a year ago.
• The Springbok basket decreased by R95.97 (-1.8%) compared to June and increased by R381.19 (7.7%) compared to last year.
• The Pietermaritzburg basket decreased by R1.32 (-0.0%) compared to June and increased by R379.78 (8.3%) compared to July 2022.
• The Mtubatuba basket decreased by R117.46 (-2,2%) compared to June and increased by R384,.95 (8.0%) compared to last year.

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Food prices and the National Minimum Wage

These increases are especially harsh considering that the National Minimum Wage is R25.42 an hour and R203.36 for an 8-hour day. In July 2023, with 21-working days, the maximum National Minimum Wage for a general worker is R4 270,.56.

Black South African workers must usually use one wage to support four people. Dispersed in a worker’s family of four, the worker’s wage is reduced to R1 067.64 per person, far below the upper-bound poverty line of R1 417 per person per month.

Using Pietermaritzburg-based figures for electricity and transport and the average figure for a minimum nutritional basket of food for a family of four, the group calculates that electricity and transport take up 56.6% (R2 418.92) of a worker’s wage of R4 270.56.

Workers only buy food after paying for transport and electricity, leaving only R1 851.64 for food and everything else. For July, the group calculates that workers’ families will underspend on food by a minimum of 47.5%, making it impossible for a worker to afford enough nutritious food for her family.

If a worker spends the entire R1 851.64 on food for a family of four people, she has only R462.91 per person per month, again far below the food poverty line of R663.

The annual increase on the National Minimum Wage was R2.23 per hour and on a month of 21 working days this is an increase of R374.64. However, the annual electricity tariff increase which came into effect on 1 July and based on Pietermaritzburg figures of a 15.1% increase, increased a workers’ electricity expense by R119.00.

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This is how the electricity tariff takes food from poor people’s plates

The new electricity tariff has removed R119.00 (31.8%) from the R374.64 increase in July, to R255.64, eroding a 9.6% wage increase to 6.6%.

The group points out that annual electricity tariff hikes continue to be an extraordinary threat to annual wage increases and this year, the Eskom tariff hike has eroded nearly a third (31.8%) off the annual National Minimum Wage increase.

“This is a significant depletion off the wages of millions of our lowest paid workers, whose wages are already insufficient to secure the very basics of life’s needs.”

All staple foods must be cooked and consumers need energy to keep warm and clean, keep the lights and appliances on and for security and therefore electricity payments are a non-negotiable expense. The higher electricity tariffs remove even more food off the plates of hardworking South Africans and their children.

Women and children in low-income families suffer the most. In July, the average cost to feed a child a basic nutritious diet was R899.54, an increase of R5.76 or 0.6% compared to June and R75.41 or 9,1% more compared to a year ago.

Compare this to the Child Support Grant of R500 and you will find it is 25% below the Food Poverty Line of R663 and 44% below the average cost to feed a child a basic nutritious diet.