According to the Food and Agriculture Organization (FAO) of the United Nations, future food prices depend on the way in which production systems can accommodate tightening resource constraints. Climate change also affects agricultural expansion and could hamper the growth necessary to meet growing demand. Ultimately, these factors could push food prices upward.
The local state of affairs
According to Wandile Sihlobo, chief economist of the Agricultural Business Chamber (Agbiz), South Africa’s food prices increased at a somewhat slower pace during January this year compared to December 2019. The country’s food price inflation peaked at 3,7% year-on-year (y/y) in January compared to December 2019, which was 3,8% y/y. However, the deceleration of food price inflation pertained only to bread, cereals, vegetables and fish. On the downside, the prices of meat, eggs, milk, cheese, fats, oil, fruit, sugar and sweets increased.
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