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.