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SA’s Fresh Produce Prices Vs The World’s: Are They The Cheapest?

SA’s fresh produce prices vs the world’s: are they the cheapest?

By Lindi Botha |20 June 2024 | 7:00 pm

The elephant in the Competition Commission’s Fresh Produce Market Inquiry (FPMI) has yet to be addressed despite the provisional report being released on Wednesday.

South Africa has some of the cheapest fresh produce in the world, despite high costs for imported inputs and no subsidies from government.Photo: FW Archive

The purpose of the investigation into the fresh produce industry was largely brought about after allegations were made during the height of COVID-19 that supermarkets were exploiting consumers with high fresh produce prices and that concentration in the market of a few large players meant that prices were being artificially controlled.

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In the FPMI report, however, no information on production and marketing costs have been included. Instead, fingers are being pointed to a lack of competition among

supermarkets and a concentration of market agents and producers as the reason prices were being kept high.

“We have the cheapest tomatoes in the world, and only Egypt has cheaper potatoes than South Africa,” said Tommie van Zyl, CEO of ZZ2, who is the largest producer of tomatoes in South Africa.

Echoing his sentiments, Wandile Sihlobo, chief economist at Agbiz, told Farmer’s Weekly that South Africa’s food prices were among the most affordable in the world. He noted that the notion d by the FPMI that prices locally were increasing faster than elsewhere globally was not correct.

The Global Coalition of Fresh Produce survey into the increasing costs of fruit and vegetable production around the world conducted in October 2023 showed that producers the world over experienced unprecedented increases in production and operating costs.

Read this before growing tomatoes

The increases were led by fertiliser (up 60% worldwide), construction (up 48%), fuel and gas (up 41%), shipping (up 40%) and electricity (up 40%). Fertiliser costs for producers in Africa increased by 79% over the last year.

Most operators were able to increase their selling prices, with rises of 11% in Europe, 13% in Oceania and South America, 14% in the US, and 23 % in Africa. The survey report however stated that these increases were not enough to compensate for the rise in production and operating costs, leaving nearly three-fifths of the global industry selling at a loss or breaking even.

Farmer’s Weekly took a ‘walk’ through supermarkets in key countries to compare prices for tomatoes, potatoes and carrots. South Africa does indeed trump the rest when it comes to consumer prices.

Prices per 1kg of fresh tomatoes as sold on 20 June 2024:

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South Africa, Checkers: R26,99/kg

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Kenya, Carrefour: R27,49/kg

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Netherlands, Albert Heijn: R53,75/kg

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US, Walmart: R68,80/kg

Prices per 1kg of fresh potatoes as sold on 20 June 2024:

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South Africa, Checkers: R19,99/kg