Competition Commission bemoans ‘opportunistic price increases’ in basic food items
The Competition Commission says consumers have been subjected to unjustified price increases of sunflower oil, white and brown bread, as well as opportunistic price increases in maize meal over a two-year period.
The commission released its Essential Food Pricing Monitoring report, which covers 2021 and 2022, on Tuesday.
The commission's spokesperson Sipho Ngwema says key trade policy decisions also affected the price of poultry products in 2022.
He says the high levels food inflation remain a concern.
“The food sector remains a priority for the commission as poor consumers spend a significant portion of their income on essential food items. As food inflation remains elevated and load shedding continues to affect business operations, food price monitoring will remain a priority for the commission, given its importance to the welfare of South Africans.”
Ngwema says there is also a visible differences between what farms get paid for food items and in-store prices, growing margins at the processor and retailer level, and potential opportunistic pricing behaviour for staple food products such as bread and cooking oil.
“From January 2022 to December 2022 white and brown bread retail prices (20% and 19% respectively) have increased faster than producer prices (15% for white bread and 14% for brown bread) implying that shelf price (R15.47 to R18.62 for white bread and R13.99 to R16.61 for brown bread) increases may not be justified by costs.
“The price of maize meal increased 32% going from R26.62 to R35.29 from January to December 2022 while the South African Futures Exchange price of white maize increased at a 2% slower rate, resulting in the price of maize charged by farmers being a lower proportion of the retail price of maize meal over the year.”
