Low-income households forgo nutritious items as food inflation takes its toll

PRICE INCREASES OVER THE PAST YEAR MEAN A BASKET OF ESSENTIAL FOOD ITEMS FOR A PERSON RECEIVING THE R350 SOCIAL RELIEF OF DISTRESS GRANT IS NOW UNAFFORDABLE.

Maverick Citizen has been tracking the prices of 14 basic food items that a consumer can buy with R350, the amount of the Social Relief of Distress (SRD) grant.

Prices in our food basket were steady from November 2023 to January 2024. However, the prices are still exorbitant for many South Africans, with a 14% year-on-year increase in the cost of our basket.

The Pietermaritzburg Economic Justice & Dignity’s Household Affordability Index (HAI), which measures inflation on basic expenditure items for households living on low incomes, helps explain the impact of rising costs.

According to the HAI, the average cost of the foods prioritised in its household food basket of 44 items increased by R54.11 (1.9%) to R2,837.56 from December 2023 to January 2024, costing 4.9% more than in January 2023.

“In January 2024, the difference in cost between the foods that families living on low incomes try and buy each month (the household food basket) and the foods which families would like to buy and should buy to meet basic nutrition (a basic nutritional food basket) was R1,215.08 (R5,324.86 vs. R6,539.94),” reads the latest HAI report.

According to the HAI, not only is a basket of 14 basic food items unaffordable for people living on grants, but a food basket of 44 basic items costs way more than the average wage, which is R4,473.92 a month in a best-case scenario of working 20 days for an average of eight hours a day at R25.42 per hour.

The HAI also found that people sacrifice food to pay for transport, utility bills and debt. With what is left they buy starch, oil and soups, often forgoing protein, fresh fruit and vegetables, with direct implications for the health and development of households.

“There is less money to secure other important mostly nutritionally rich foods, which are essential for health and wellbeing and strong immune systems (meat, eggs and dairy, which are critical for protein, iron, and calcium; vegetables and fruit, which are critical for vitamins, minerals and fibre; and maas, peanut butter and pilchards, good fats, protein and calcium essential for children). The data show that the core foods contribute 53% of the total cost of the Household Food Basket.

“At an average cost of R2,837.56 in January 2024, these foods are relatively very expensive with the total money available in the household purse to secure food. These foods must be bought regardless of price escalations. The high cost of core staple foods results in a lot of proper nutritious food being removed off the family plates,” reads the HAI report.

The cost of the National Agricultural Marketing Council’s (NAMC’s) 28-item urban food basket increased by 9.6% in December 2023 compared to the same period in 2022, reaching R1,239.59 compared with R1,131.01, with a monthly (November 2023-December 2023) increase of 0.6%.

Of the 28 food items in the NAMC urban food basket, the price increase of 18 exceeded the inflation target of 6% set by the Reserve Bank.

Over 12 months, the price of potatoes shot up by 55.4%, followed by “bananas (29.9%), oranges (28.5%), Ceylon/black tea (28.2%), eggs (24.9%), white sugar (22.6%%), instant coffee (21.5%), rice (20.6%), apples (19.8%), peanut butter (16.2%), baked beans (14.6%), dried beans (9.2%), cheddar cheese (8.4%), full cream milk (8.2%), cabbage (7.4%), tomato (6.9%), fish (6.5%) and polony (6.1%)”.

Read more in Daily Maverick: SA food price rises in 2024 likely to moderate for most products 

The picture painted by these food baskets checks is depressing but experts say 2024 might be less difficult than 2023. Inflation averaged 5% from October 2023 and is projected to stay there for 2024. Even though food inflation ended the year above headline inflation at 7%, Stat SA has noted the minute decreases in the costs of cereals, bread, oils and fats.

The Agricultural Business Chamber of South Africa expects this moderation path to continue in 2024 for most of the products in the food basket.

Proposals to alleviate hunger

The child grant is R510 and the SRD grant is just R350 a month. The DG Murray Trust has proposed having 10 “Best Buys” to ease the burn of high food prices.

The organisation has called on the government, business and civil society to work together to bring down the prices of 10 basic nutritious foods.

“Manufacturers and retailers agree to forgo their profits on one product label of 10 best-buy foods. The government agrees to provide a subsidy to retailers and manufacturers matching the value of their discount on the 10 best buys. Civil society promotes the 10 best buys to help shape consumer behaviour towards the most affordable nutritious foods,” the proposal reads.

Read more in Daily Maverick: Subsidising these 10 essential products could help stave off malnutrition in SA, say civil society groups

Other organisations have thrown their weight behind the concept of a universal income grant or basic income grant (BIG) to create buying power and mitigate hunger and malnutrition. In December, the Institute for Economic Justice and Applied Development Research Solutions released a working paper on the Macroeconomic and Developmental Impacts of Selected Basic Income Grant Pathways for South Africa.

This aimed to debunk mainstream economic models that predicted that implementing a BIG would negatively affect the economy. It said the expansion of the social grants system in South Africa had been successful and, “A BIG programme can produce win-win outcomes.”

While academics, economists and farmers eye solutions to mitigate hunger and malnutrition, families make do with what they have. The HAI shows that in January families in low-income households could only buy half of the basic priority food basket.

“The minimum shortfall on food for a family is 51.7% in January 2024. After securing transport and electricity, workers are left with R1,807.00. If all of this money went to food, then for a family of four, it would provide R451.75 per person per month. The Food Poverty Line is R760.”

This article was written by Naledi Sikhakhane and was first published on Daily Maverick on 31 January 2024.