By Lebogang Mashala
Meat prices have risen despite challenges from foot-and-mouth outbreaks, complicating the price outlook and domestic supply dynamics.
The latest update on food inflation in South Africa shows a continued increase, with rising prices for vegetables and meat in May 2025. The annual food inflation rate rose by 1.1 percentage points from the previous month, reaching 4.4% year-on-year in May 2025.
According to Paul Makube, FNB’s senior agricultural economist, the monthly food inflation rate slowed to 1.2% month-on-month in May, down from 1.3% in April 2025. He noted that, despite the increase in food inflation, the overall consumer inflation rate remained stable, surprising many by pausing at 2.8% year-on-year in May 2025. The monthly inflation trend also continued to decelerate, remaining below 1% at 0.2% month-on-month.
Makube noted while the inflation rate for fruits and nuts experienced the largest annual increase of 6.2 percentage points, rising to 13.5% year-on-year in May, it has declined for three consecutive months to -1.3% month-on-month. This decline reflects a favourable supply situation following excellent seasonal production conditions.
He explained that earlier weather-induced supply constraints, along with delays in harvest and logistics, led to a surge in vegetable inflation, which reached 10.3% year-on-year and 5.9% month-on-month in May 2025. The rise in meat prices has continued due to tight supplies, pushing meat inflation up by 1.2 percentage points from April to a 23-month high of 4.4% year-on-year in May 2025. However, month-on-month meat inflation decelerated from 2.3% in April to 1.2% in May 2025, according to Makube.
“We are not surprised by this development, as producer-level prices surged across the livestock sector, with average class A beef carcass prices surpassing R70/kg for the first time in history. Prices have increased despite the challenges posed by disease outbreaks, which have complicated the price outlook and domestic supply dynamics,” he stated.
Makube mentioned that the ongoing foot-and-mouth disease (FMD) outbreak has led to an export ban and a quarantine of affected establishments, creating a supply crunch due to the inability to process livestock. Additionally, constrained import supplies, driven by an avian influenza- (AI) induced ban on South Africa’s largest poultry meat supplier, Brazil, have further driven up prices, particularly for mechanically deboned meat (MDM), which is used in products like polony. South Africa is a net importer of MDM due to limited domestic production capacity.
“Meanwhile, the inflation rate for bread and cereals has continued to surprise on the downside, decreasing to 4.5% year-on-year and only nudging up 0.1 percentage points from April to 0.4% month-on-month in May 2025. It is clear that the lag effect of the supply shock and the subsequent spike in grain prices over the past eight months has not fully materialised,” Makube explained.
Furthermore, he noted that globally, food inflation, as reported by the United Nations’ Food and Agriculture Organization (FAO), has sharply decreased by two percentage points from April to 6% year-on-year in May 2025. This decline is a result of falling prices for cereals, vegetables, and sugar, which more than offset gains in the animal protein categories (dairy and meat). Strong global demand has driven monthly prices for bovine, ovine, and pig meat up by 1%, 8.3%, and 2.3%, respectively, in May.
“However, global pig meat inflation remains in deflationary mode for the fourteenth consecutive month at -0.4% year-on-year, while bovine and ovine meats have seen significant increases of 11.8% and 29.7% year-on-year, respectively. The AI has severely impacted the poultry market; import bans from several countries and resultant oversupply have led to reduced quotations from Brazil. Poultry meat prices fell by -0.8% month-on-month but increased to 3.3% year-on-year in May, up from 2.6% year-on-year in April,” Makube explained.
“On a closing note, the combination of renewed appreciation in the rand exchange rate and a promising summer crop harvest outlook poses a downside risk for most agricultural commodities in the year ahead,” he said.
Makube also stated that meat prices are approaching consumer resistance levels and may not be sustainable for an extended period, particularly given sluggish economic growth and weakened consumer purchasing power. “Nonetheless, the continued decrease in fuel prices, which have fallen by 14% year-on-year, along with a stable to declining interest rate outlook, is favourable for consumer financial recovery in the remainder of the year.”
