From CNBC Africa
Analysts are warning that the price of maize meal, meat and poultry products could soar in 2014, mainly due to the current exchange rate.
“On analyzing the whole scenario around the stock levels and where we are, calculations come up to about 30 per cent more for maize meal. This is based on the exchange rate weakening by about 16 per cent year on year in 2011, [which] gave us a rise in the vicinity of about 30 per cent,” ABSA Agribusiness head Ernst Janovsky told CNBC Africa.
Janovsky explained that the expected price hikes are due to the current drought in the country, especially within the white maize producing areas. This results in limited stock and low inventories.
“[There will be] a hike in the sense that all of a sudden certain companies are running out of stock, but other companies still have stock. That means there’s a juggling for positions in terms of who is going to market what during this period, and who has the product to market,” he said.
He added that the consumer should therefore expect to pay more, with the basic consumer being hurt the most throughout the price hike process.
Written by Wilhelmina Maboja/Read more at CNBC Africa
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