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COVER STORY | There’s (always) money in food

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Grocery food basket. (Getty)
Grocery food basket. (Getty)

People must eat. Considering Maslow’s hierarchy of human needs, food, water, warmth, rest, security and safety are the basic needs of humans that require fulfilment. Money is ordinarily made when a need and a solution meet each other and the acquiring party values the solution enough to transfer cash for it.

Food, as opposed to water, is not a public good in SA and is produced according to market principles. It is a big industry. In terms of Stats SA’s basket to measure the consumer price index, food is the second-largest component after housing (another base need), comprising 15.48%.

And food prices have been accelerating locally. In December last year, the rate at which food prices (at the consumer level) increased reached double the speed of headline inflation, 6.2% compared with 3.1%. Since March this year, consumer-level food price inflation has remained above 6% annually (see graph 1). Worryingly, food price inflation at the farm gate has remained elevated above 6% per year since October last year.

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