Skip to main content

Consumers pay more at till for chicken, but farmers paid less, report finds

| Research tools

By: Given Majola - IOL

While consumers paid more to buy chicken between February and April this year, farmers were paid less for this commodity, according to the latest Farm-to-Retail Price Spread report, published in May this year by the National Agricultural Marketing Council (NAMC).

The report found the real farm value share of chicken over this period decreased by 3.26%, while the real farm-to-retail price spread (FTRPS) of a fresh whole chicken increased by 1.76%.

The NAMC analysed data sets to compare prices paid by consumers for food with the prices received by farmers for corresponding commodities.

The farm value share is the value of the farm product's equivalent in the final food product purchased by the consumers. The FTRPS is the difference between what the consumer pays for the food product at retail level and the value of the farm product used in that product.

According to the report – compiled by the NAMC’s Corné Dempers and Dr Moses Lubinga – the real farm value share of fresh whole chicken meat reached 55.41% in April.

“From April 2023 to April 2024, the real farm value share decreased by 6.33%, while the real FTRPS increased by 14.97%. This could be due to the competitiveness in the poultry value chain being affected by factors such as imports and high feed prices, among other factors,” it said.

For the same period, the real FTRPS of class A2/A3 beef increased by 0.95%, while the real farm value share decreased by 0.47%. The real farm value share reached 49.18% in April. Year on year, the real FTRPS slid by 12.64%, while the real farm value share rose by 4.64%.

Namc said the lingering effects of foot and mouth disease disrupted the production of red meat locally and there were changes in retail demand and farm commodity supply.

Class A2/A3 lamb decreased by 2.82% (from R80.36/kg to R78.09/kg), while the real farm value share moderately decreased by 0.37% (from 47.59% to 47.76%) during this period. Year-on-year, the real farm value share fell by 3.65%, while the real FTRPS decreased by 1.22%.

The real FTRPS of pork decreased by 3.87%, on average, from R52.99/kg in February to R50.94/kg in April, while the real farm value share of pork rose by 2.71%, from 34.22% in February to 35.14% in April. Year on year, the real FTRPS decreased by 25.69% (from R68.55/kg to R50.94/kg), while the real farm value share leapt by 20.44% (from 29.18% to 35.14%), according to the report.

The real FTRPS for full cream milk fell on average from R10.52 a litre to R10.12 – a 3.79% decrease between February and April. The real farm value share increased by 3.38% during the same period. Year-on-year, the real FTRPS slid by 4.69% and the real farm value share rose by 5.22%, respectively.

For maize, the real farm value share of maize meal (5kg) increased by 8.95%, from 48.44% in February to 52.77% in April, while the real FTRPS of maize meal (converted to a price per ton) fell from R5 518.18/ton in February to R4 862.19/ton in April – an 11.89% decrease. Year on year, the farm value share slid by 11.26%, while the real FTRPS increased by 6.61%.

In April, the real FTRPS for white bread reached R28 070.15/ton of flour, with brown bread reaching R28 139.64/ton of flour. The real farm value share for white and brown bread reached 17.89% and 16.94%, respectively. Year on year, the real FTRPS for white bread and brown bread slid by 5.88% and 3.03%, respectively.

BUSINESS REPORT

Pin It

Related Articles

By: Bianke Neethling – Daily Investor This is the view of Sasfin analyst Alec Abraham, who told Daily Investor that the key headwind for food retailers in South Africa is the economic malaise degrading consumer wealth.
A national survey, released during Men’s Health Month, unveils fascinating insights into the beverage preferences of South African men.
Pick n Pay Smart Shopper customers are increasingly spending their points on airtime and data, a popular loyalty reward exclusive for retailer Pick n Pay.
By: Staff Writer - MyBroadBand Mr D Groceries has partnered with Pick n Pay stores across South Africa to give shoppers access to more than 27,000 food products at in-store prices – including drinks, meat, snacks, fresh produce, and more.
By: Lynette Dicey - BusinessLive Loyalty programme usage in South Africa has grown from 67% in 2015 to 76% in 2023/2024 across both gender and income categories, says the most recent “South African Loyalty Landscape Whitepaper” by Truth &...