More braais this festive season as meat prices fall
Red meat lovers are expected to stock up more during the festive season with the anticipated fall of the meat price due to the persistent dry weather conditions.
Farmers are reducing their livestock as a result of deteriorating pastures and the current high feed-grain prices and consequently, the price of red meat at a retail level is expected to fall by between eight to 15 percent between December and January next year as more animals are being slaughtered by farmers, leading to an oversupply of meat in the short-term.
On average, beef and lamb prices at farm level are already marginally down by one and two percent respectively, with further declines expected as grazing conditions deteriorate further due to a lack of rain.
Paul Makube, senior agricultural economist at FNB, said consumers who are already struggling to provide for basic needs caused by rising food and electricity costs, should expect temporary relief during the festive season as meat prices are expected to drop over the next two months.
He said the lower price of meat will be further sustained in January due to a lower demand from cash-strapped consumers who will be cutting back on spending, following the holidays and facing new expenditure on school requirements.
Despite the temporary relief in meat prices, consumers should not be misled. The drought conditions affecting the agricultural industry will have negative consequences on food prices in the longer term.
Makube cautions that meat prices are expected to significantly increase from March and April next year as farmers start rebuilding their herds. Herd-building takes time, and this will inevitably lead to a supply shortage in the long term because of a limited number of animals entering the food supply chain.
Therefore, the increasing price of meat at farm level, coupled with a contraction in meat supply, will ultimately result in retailers passing on costs to the consumers. In contrast, consumers who prefer pork and poultry can expect to pay more in December as prices are expected to trend slightly upwards due to the increased demand ahead of the festive season.
As consumers prepare for the holiday season, they can at least look forward to enjoying a traditional braai with friends and family, without worrying too much about the cost.