Lower food inflation brings only limited relief as fuel and transport costs bite

South Africa’s food inflation eased to 2.8% in April, down from 3.4% in March, but economists and civil-society groups warn that higher fuel and transport costs could reverse those gains and keep overall consumer inflation elevated.

What drove the slowdown in food inflation

Wandile Sihlobo, chief economist at the Agricultural Business Chamber of South Africa, attributed the moderation in food inflation to improved supply conditions for major agricultural products. He pointed to lower prices for grain, fruit and vegetables and moderating vegetable oil prices as key factors.

Sihlobo said South Africa’s 2025-26 summer grains and oilseeds production is forecast at a record 20.8 million tons, up 1% from the 2024-25 season, and that strong fruit exports were supported by a large domestic harvest despite recent floods in parts of the Eastern and Western Cape.

On meat, Sihlobo noted that temporary export restrictions linked to foot-and-mouth disease outbreaks have increased domestic meat availability. He added:

“Another fact worth keeping in mind is that during foot-and-mouth disease outbreaks, the country is typically temporarily closed to certain export markets, leading to increased domestic supplies, even if the slaughtering has reduced somewhat.”

Fuel and transport: the downside risks

Despite the softer food price trend, Sihlobo warned that rising fuel prices tied to geopolitical tensions in the Middle East could undermine progress later in the year. He said fuel accounts for a substantial share of distribution costs for food products and that fuel accounts for 13% of grain farmers’ input costs, while also emphasising that farmers are price takers.

Evashnee Naidu, KwaZulu-Natal regional manager of Black Sash, said the improvement in food inflation had been largely invisible to many low-income households. She warned:

“The global crisis on fuel is seeing a marked increase in fuel prices which affects both public and private transport and the escalating costs of diesel sees a knock-on effect on food prices.”

Wider inflation and policy implications

Statistics South Africa data show that headline consumer inflation accelerated to 4% in April. Aliya Chikte, project officer at the Alternative Information and Development Centre, highlighted that some nutritious food categories are rising faster than overall food inflation, increasing long-term risks to public health.

Chikte also said:

“Although food inflation is low, headline inflation is high at 4% driven by increases in utility costs and the price of transport.”

She cautioned that rising fuel and electricity prices could complicate decisions by the South African Reserve Bank, noting that South Africa’s inflation target was revised in 2025 to a point target of 3%, which she described as a tighter anchor that leaves less room to absorb external shocks.

What this means for households

While lower food inflation in April offered short-term relief, the combination of higher fuel and transport costs and persistent increases in key nutritious food items and utilities suggests many households may see limited lasting benefit from the recent slowdown in food price growth.