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2022-03-28

Food prices to be investigated in South Africa – what you should know

The Competition Commission has announced plans to investigate South Africa’s fresh produce food market.


Staff Writer | Business Tech

“Essential foods are critical to the socio-economic well-being of a nation, and in particular to its poorest consumers for whom essential foods form a significant portion of household expenditure relative to other wealthier consumers,” the commission said.

“In the context of the Covid-19 health crisis, it has become clear that nutrition and affordable healthy foods are important for household health as well as maintaining a country’s food security.”

The commission cited several studies noting there is broad concern over price levels and volatility of pricing for fresh produce in South Africa.

“The studies show that the higher prices of fresh produce have a disproportionate effect on the poor and low-income earners who have to spend a far greater portion of their income to purchase essential products.

“A fuller understanding of the main drivers of the apparently high prices of fresh produce in South Africa is a critical area that this inquiry may address.”

The commission said that the Covid-19 pandemic also affected supply and demand within the fresh produce markets, with initial surges in the pricing of some fresh produce and evidence of continued volatility in a market that has seen a number of events in the past two years.

“Beyond the observations from the research on pricing and other market concerns for fresh produce – including for instance the series of Essential Food Pricing Monitoring Reports released by the Commission – there have been a number of complaints and/or investigations in the sector over previous years.

What will be looked at 

For the purposes of the inquiry, fresh produce includes unprocessed products such as fruit and vegetables, and forms an important part of South Africa’s wider agriculture industry, the commission said.

The main fruits produced and consumed in South Africa include:

  • Apples;
  • Bananas;
  • Oranges and other citrus;
  • Pears;
  • Avocados;
  • Grapes;
  • Potatoes;
  • Onions;
  • Tomatoes;
  • Carrots;
  • Cabbage.

The inquiry is expected to touch on several areas including seed and fertilisers companies, the country’s major farmers, and distributors.

 


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