Producer inflation forecast to stay elevated on rising food prices

• Published date: 26 April 2024
• Author: Siphelele Dludla siphelele.dludla@inl.co.za
• Publication title: Star, The (Johannesburg, South Africa)

Data from Statistics South Africa (StatsSA) yesterday showed that the annual producer price inflation inched higher in March, rising to 4.6% from 4.5% in February

StatsSA said the main contributors to the acceleration in overall PPI inflation were food products, beverages and tobacco products.

Inflation for food, beverages and tobacco products accelerated further to a 3-month high of 4.4% in March from 4.3% in February, with most of the upward pressure coming from elevated fruit and vegetable prices which increased by 13.5% year-on-year.

Grain mill product prices also accelerated by 2.6% from 1.9% in February, reflecting the impact of adverse weather conditions over the past three months.

According to the Agricultural Business Council, upside risks also remain for the “bread and cereal products” in the food basket, owing to “the potentially poor white maize harvest from the recent heatwave and dryness”.

StatsSA said inflation for “coke, petroleum, chemicals, rubber, and plastic products” continued to rise, accelerating to a 5-month high of 4.6% due to higher fuel prices as the price of petrol increased by 5% in March.

By contrast, prices slowed down for non-metallic mineral products; electrical machinery and communication and metering equipment; and transport equipment.

On a monthly basis, producer prices inched up by 1.1% in March, the most in seven months, and after a 0.5% rise in February.

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