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No money to buy fresh vegetables, so prices drop

| Economic factors

The price of vegetables at supermarkets targeting the low-income retail market in Pietermaritzburg dropped month on month, possibly because of an affordability crisis, according to research by the Pietermaritzburg Agency for Community Social Action.

Although the study was based in the city, Mervyn Abrahams of the agency said the same was likely to be playing out across the province.

The NGO started tracking food prices in 2006 by comparing a basket of food items monthly at six supermarkets in the city serving the low-income market.

The latest figures revealed that while the food basket as a whole increased, when looking specifically at vegetables, prices dropped from February to March.

“The decrease in the vegetable price was an artificial one, driven by a drop in demand for vegetables on the supermarket shelves. Consumers, under financial stress, switched from the supermarket to street traders where vegetables were available for purchase in smaller volumes and could be individually hand-picked.

“The drop in demand on the supermarket shelf - caused by the affordability crisis in the pockets of the target market - forced the vegetable prices (perishable foods) down as an attempt to push up demand,” he said.

Three managers in charge of the fruit and vegetable section at supermarkets, who did not wish to be named, said they were still buying vegetables at high prices.

The agency’s data showed that between February and March, the price of a 10kg pocket of potatoes had dropped from R70.63 to R60.32; 3kg tomatoes from R47.39 to R35.38; and a 10kg pocket of onions from R59.16 to R50.66.

Abrahams said despite attempts by the supermarkets to induce demand, consumers could still not afford the reduced prices.

“A handful of supermarkets were found to be removing over-ripe tomatoes and green, sprouting potatoes from their shelves.

“The significant price drop of vegetables in our barometer is a reflection of how the affordability crisis in low-income households is now resonating in supermarkets which target the low-income retail market. It suggests that elasticity around food prices, particularly perishables, has declined steeply,” he said.

Abrahams said households with low incomes were unable to absorb price increases by spending more money.

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The Mercury

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