Africa-Press – South-Africa. SA’s top competition watchdog has flagged that local prices of bread, maize meal and cooking oil are not cooling as fast as the sharp decline in global commodity prices.
In the Competition Commission’s latest report on essential food prices, it notes that although global bread and wheat prices had fallen by about 10% during the first quarter of the year, South African retail prices for bread had risen 3% during the same period.
Global white maize prices have fallen consistently and by 23% since February, but retail prices for maize meal have yet to decline.
Global cooking oil prices have fallen, but retailers have also been “slower to reduce prices resulting in expanding margins”. It said sunflower seed prices had also dropped but producer prices had still not responded.
So far in 2023, weaner calf prices had declined substantially, which had also led to lower prices for beef carcasses. However, the commission noted, the retail price for beef cuts had not fallen this year. Retailers now earn 40% of the shelf price of beef, the highest share since January 2021.
But the report notes that South African producers and retailers were facing other cost pressures, including load shedding, which may explain why there had been a major lag between global prices coming down and consumers seeing lower prices on supermarket shelves.
Still, the report also highlights that South African retailers remain more profitable than their counterparts in countries such as the UK, Ireland and Canada – and attributed this to a lack of competition in the local market.
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