Shoprite marketing director Brian Weyers said price decreases on some basic foodstuffs were now coming through due to a softening in international prices of commodities such as sunflower oil and wheat. The company expected price decreases to be good news for hard-pressed consumers, though the savings varied depending on the product.
Price decreases affected the same types of items that resulted in the price increases recently seen.
“Bread suppliers have already put through decreases on the prices of the most popular loaves and more price drops are expected in the coming weeks. Prices of margarine and sunflower oil are also coming down and consumers would see even lower prices if the rand gets stronger,” Weyers said.
However, milk was expected to increase as a result of seasonal conditions, which would spill over into other dairy products. The tin plate price hike would also affect all tinned foodstuffs.
Shoprite said it would continue to cut internal costs to limit the blow to consumers. “Negotiations with suppliers also remain a priority to ensure that no undue increases are pushed through to consumers.”
Pick n Pay said the decreases were either already on the shelf, or would not be very significant.
Kevin Korb, the chain's food merchandise director, said that “a good number of commodities have come down in price”, but these savings were already in the system. The group also aimed to reduce internal costs for the benefit of the consumer.
He said the retailer's buyers had not received much indication from suppliers that there were decreases in the pipeline.
However, in the past few months cooking oil, cheese and plastic carrier bags had cost less. “On the input side, we have seen quite a dramatic drop in the price of two main brands of fertiliser.”
ArcelorMittal's announcement that it would increase the price of tin plate 80% would translate into an increase of a minimum of 10% on items such as canned fruit and vegetables, meat and fish.
“This increase is very unfortunate, particularly at a time when many South Africans are battling to make ends meet,” Korb said.
However, at least commodities had remained constant since July last year, meaning that Pick n Pay's basket is up 5% on July last year. Internal inflation stands at about 14% for the group.
Source: Business Day
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