Agricultural economist Wandile Sihlobo noted that, against expectations, food inflation had dropped from 9% in November to 8.5% in December.
Sihlobo, chief economist at the Agricultural Business Chamber of South Africa (Agbiz), said the organisation expected the food price moderation “to continue in 2024 for most of the products within the food basket”.
The significant risk to meat supplies that animal diseases such as avian influenza presented in 2023 could ease this year. “There will likely be a recovery in poultry production following a range of interventions that the industry and the government embarked on at the end of last year,” Sihlobo said.
Sihlobo did not expect tariff rebates to be implemented soon in order to encourage chicken imports. He said the rebates were for use “in the event of supply constraints, which we do not anticipate over the foreseeable future”.
Investec chief economist Annabel Bishop said consumer price inflation (CPI) had dropped to 5.1% in December, and might rise slightly in January before dropping again.
“Nevertheless, food price disinflation is expected to alleviate some of the pressure on inflation for the year,” she said. This was partly because food prices had been moderating internationally and have been falling year-on-year since the start of 2023.