Fuel price increase, hot weather threaten SA food security

By Ina Opperman

The large fuel price increase as well as the hot weather and little rain in February threaten South Africa’s food security. Current weather conditions pose a large enough threat to farmers to cause a potential crop yield loss.

This could place a heavy financial burden on the nation’s farmers at a time when they are struggling to keep their heads above water.

Wandile Sihlobo, chief economist at the Agricultural Business Chamber of South Africa, says weather conditions in various areas, where significant summer grains such as maize, sunflowers and soybeans are in the pollination stages are not the best as it should ideally have higher moisture levels during this stage to boost yields.

This means there is a real possibility that this could lead to South Africa’s farmers producing fewer summer grains than previously expected and that poses a threat to the country’s food production. Rainfall over the next few weeks is crucial to ensuring a better agricultural harvest.

“This is not the time to announce another steep hike in the petrol price,’’ warns Neil Roets, CEO of Debt Rescue. “Petrol price increases do not just hurt motorists who need to fill up their vehicles, they have a devastating effect on the country’s food supply.“Our farmers who we rely on for the food we put on our tables, are hit very hard financially by each hike in the price of fuel. The farming industry relies predominantly on diesel, not only to run their tractors and lorries but also their machinery.”

Second consecutive steep increase in fuel price
The department of mineral resources and energy announced a second consecutive steep jump in the price of 93 and 95 unleaded petrol and a substantial hike in diesel prices on Monday that will come into effect on Wednesday.

Despite the small positive movement during the last months of 2023, the March price hike will send petrol prices back above R24 a litre for 95 unleaded petrol and reverse much of the relief provided through price drops since November 2023.

The price of unleaded petrol will increase by R1.21 per litre, bringing 95 unleaded petrol up to R24.45 per litre, while 93 unleaded will reach R24.13 per litre. Diesel will increase by between R1.05 and R1.19 per litre.

The only good news for consumers is that the two main levies on fuel, the General Fuel Levy and the Road Accident Fund levy, will not increase for the third consecutive year.

“These levies traditionally increase in February and the increases are implemented in April, but the minister of finance heeded calls by the Automobile Association (AA) and in his February budget speech and indicated this will not happen again this year.

“Although not a saving as such, any increases would have added additional pressure to fuel prices and we again welcome his decision not to increase these rates for 2024,” the AA said.

High fuel price a heavy burden on farmers
“The latest petrol price hike will place a heavy burden on our farmers and other role-players in the agricultural sector, potentially plunging the country into a food security crisis that will not only affect supplies, but also inevitably hit the pockets of South African citizens hard. The burning question is: can consumers survive another petrol price hike?” Roets says.

Economists agree, saying that a steep increase in the fuel price could have a big impact on inflation. Chief economist of the Efficient Group, Dawie Roodt, says the increase comes at a time when the economy is not growing and consumers are suffering.

“The poor will be affected heavily. The rand is under a lot of pressure and is much weaker than it was a month ago and this is one of the major reasons for the fuel price increase.”

Roets points out that consumers are buckling under the highest interest rates the country has seen in more than a decade, increasing levels of debt and eroding disposable incomes, while salaries cannot keep up with inflation.

“A real sense of hopelessness now hangs over desperate consumers who are sliding deeper and deeper into debt to keep their families afloat. This is deeply concerning,“ he says.

Follow the link to read the full article: https://www.bloemfonteincourant.co.za/fuel-price-increase-hot-weather-threaten-sa-food-security/

Like Love Haha Wow Sad Angry

Thank you!

We look forward to the opportunity to get you debt-free!

Did you know?

You can start your application process already. Simply download your assessment or fill in our online application and get one step closer to becoming debt-free with Debt Rescue!

Subscribe to Our Weekly Email

By completing this form, you are providing Debt Rescue with the above personal information and acknowledge the terms of Debt Rescue’s Privacy Notice.