LOWER FUEL PRICES HELP
By Francois Williams Wednesday, December 24, 2014 05:20
South African consumers can look forward to a slowdown in growth or even a decline in food prices in 2015, says Johannes Möller, president of the agricultural organization Agri SA.
In November, food price inflation still 6.5%, but the producer price index for agricultural, forestry and fisheries was 2.3%. “The latter is likely within a few months have a decreasing effect on food price inflation.” The lower price of fuel is one of the factors contributing to this trend, believe Moeller. Fuel expenses amounted to 14% of agricultural expenditure, and recent and expected further price reductions can reduce this cost component.
The rest of the food value chain also contribute to the cost-benefit to consumers by giving, he said. According to a recent report by the consulting firm DuPont South Africa the African country with the highest level of food security.
In its 2014- global food security index compared South Africa’s 61.1 points well with those of its BRICS partners. India stands at 48.3 points, 62.2 China, Russia and Brazil to 62.7 68.1.
Most African countries have between 30 and 40 points. But developed industrial countries running for more than 80 points. Agri SA says local agricultural thing successful note in export markets. In 2013 R72.5 billion in agricultural products exported R15,2 billion over agricultural imports.
“With favorable production conditions and the weaker rand will further enhance this capacity and performance of the industry in 2014 and 2015,” it said Agri SA’s statement.
The rainy season has so far been favorable for agriculture. Irrigation, which is 25% of the value of agricultural production contributes, has good prospects for 2015 with dams nationwide average 80% full.
Möller continued agricultural investment is the best guarantee for continued food security and sustainable, competitive production. The value of agricultural investment this year grew by 8.4%, supported by 10.1% growth in property values and 9.9% growth in the value of investments in machinery, implements and vehicles.