The forgotten cost of food production in South Africa

South Africans have become all too familiar with rising food prices. Every trip to the supermarket seems to confirm the same reality: the weekly grocery bill is higher than it was only a few months ago. Something as simple as buying two cans of Pringles on a special can now cost close to R99. If a snack has become a luxury, it is hardly surprising that buying household staples such as maize meal, rice, flour, cooking oil and onions is placing increasing pressure on family budgets.

By Ella Mogashoa, a researcher in the Faculty of Natural and Agricultural Sciences at the North-West University (NWU)

For most consumers, inflation is experienced at the checkout counter. For farmers, however, inflation begins long before food reaches the supermarket shelf.

Behind every loaf of bread, bag of maize meal and bottle of milk lies a production system under immense financial pressure. Escalating electricity tariffs, rising fuel prices, increasingly expensive fertilisers and climate-related risks have combined to make food production significantly more costly. While consumers understandably focus on the price of food, far less attention is given to the growing cost of producing it.

Food security begins long before consumers walk into a supermarket. It starts on farms where producers are making difficult decisions every day about how to continue producing food while facing rising production costs.

Also read: From our editor: Winter’s silent war on South African farmers

Food security begins on the farm

Every food product starts its journey on a farm, where producers face increasing input costs throughout the agricultural production cycle.

Electricity powers irrigation systems, cold storage facilities, packhouses and processing plants. Fuel keeps tractors operating during planting and harvesting and powers the transportation of inputs to farms and produce to markets. Fertilisers and other agricultural inputs remain vulnerable to global market volatility, adding even more pressure to farming operations.

In agriculture, these are not optional expenses. They are essential production inputs. Farmers cannot simply switch off irrigation systems or refrigeration facilities because electricity has become more expensive.

South Africa has experienced successive increases in electricity tariffs over recent years. Direct Eskom customers saw tariff increases of approximately 12,74% in 2024, followed by another increase in 2025. From 1 April 2026, the National Energy Regulator of South Africa approved a further average increase of 8,76% for customers supplied directly by Eskom.

For energy-intensive farming operations, particularly irrigated agriculture, these increases have significant financial implications.

Also read: Borders and jobs: What the ‘March and March’ debate means for SA’s agricultural labour force

Rising fuel costs continue to squeeze producers

Electricity is only one part of the challenge.

Diesel and petrol remain indispensable for powering agricultural machinery and transporting both farming inputs and harvested produce across the country. As fuel prices continue to rise, so does the cost of producing food.

Additional pressure is expected following the expiry of the temporary General Fuel Levy relief from 1 July 2026, further increasing operating costs for many agricultural businesses.

Every increase in fuel prices affects multiple stages of agricultural production. It influences field operations, transportation, distribution and, ultimately, the price consumers pay for food.

Why farmers cannot simply charge more

Unlike many other industries, agriculture does not operate on a straightforward cost-plus pricing model.

Farmers are generally price takers rather than price makers. They compete in highly competitive domestic and international markets where commodity prices are largely determined by market forces.

The agricultural sector behaves much like a sponge. Farmers absorb rising production costs for as long as possible before those pressures eventually filter through the food value chain.

Many producers continue farming despite shrinking profit margins because agriculture does not allow production to pause until economic conditions improve. Crops continue growing, livestock still require feeding and harvesting cannot be delayed indefinitely.

This creates a common misconception that farmers simply increase prices whenever costs rise. Many producers are working under increasingly tight financial margins simply to remain viable.

Also read: The impact of the interest rate hike for farmers and food prices

Protecting the South African food system

Agriculture remains one of the most strategic economic sectors in South Africa. It supports rural livelihoods, creates employment, generates export earnings and plays a vital role in ensuring national food security.

When production becomes increasingly expensive, investment slows, expansion plans are postponed and producers become less competitive in both domestic and international markets.

Consumers eventually experience these pressures through higher food prices, but the long-term consequences extend beyond affordability.

The sustainability of our food system depends on the sustainability of those producing our food. If farming becomes economically unsustainable, food security itself becomes increasingly vulnerable.

Looking beyond reliable electricity

South Africa has made encouraging progress in improving the reliability of the electricity supply. While this is a positive development, reliability alone is not enough.

Energy affordability has become equally important.

As agriculture becomes increasingly technology-driven, greater investment in renewable energy, climate-smart farming technologies and energy-efficient production systems will be essential to strengthen long-term food security while reducing dependence on increasingly expensive conventional energy sources.

Supporting innovation and affordable energy solutions in agriculture is not simply about helping farmers. It is about protecting the ability of the country to produce affordable food for future generations.

Also read: Do you use water on your farm? What you must do before 23 July 2026

Investing in the future of food

Food security does not begin in supermarkets.

It begins with farmers who make daily decisions about whether they can afford to plant another hectare, invest in new technology or employ additional workers despite mounting production costs.

As consumers, we often focus on the meal on our plates without considering the costs involved in producing it.

The next time we question why food prices continue to rise, perhaps we should ask a more fundamental question:

How long can farmers continue absorbing these increasing costs before the entire food system begins to feel the full impact?

The future of affordable food depends on ensuring that farming remains economically viable. Supporting agriculture is not simply about protecting one sector of the economy. It is about safeguarding the food security of South Africa, strengthening rural livelihoods and building a more resilient future for everyone.