Fears about the likely higher food price inflation in various parts of the world have been in the headlines for some time. The major catalyst for this discussion in recent months has been the ongoing US-Iran war and the upside pressure it exerts on fuel and fertiliser prices. The drought and heatwave in Europe and the Americas is another challenge.
In recent weeks, Russia’s aggressive efforts to bomb key infrastructure in Ukraine have also added to the risks of higher food price inflation in various parts of the world. How all these events will affect the global food system remain to be seen in the coming year.
For now, the various regions of the world continue to benefit from the ample agricultural harvests of the previous years. Here in South Africa, for example, we are seeing the benefits of ample agricultural output from the 2025-26 season reflected in inflation data, which continues to decelerate.
The figures recently released by Stats SA show that the country’s consumer food price inflation slowed to 0.6% in July, from 1.4% in June – the lowest level since 2010.
Also positively, meat price inflation has slowed from recent levels, as slaughtering continues and supplies recover.
A detailed view
Now, if we zoom in on the key products, cereal (grains) products are in deflation, as we are in yet another year of better grain production. South Africa’s summer grains and oilseeds production is forecast at a record 21.6-million tonnes, up 5% from the 2024-25 season, according to the latest data from the Crop Estimates Committee.
Regarding meat, the pace of cattle slaughter has declined somewhat, though not notably. Another fact worth keeping in mind is that during foot-and-mouth disease outbreaks, the country is typically temporarily closed to some export markets, leading to increased domestic supplies, even if slaughter has declined somewhat. Base effects on meat prices, along with continued cattle slaughter, have helped ease price inflation. Poultry output conditions are also favourable.
Low food price inflation
In essence, South Africa’s ample agricultural harvest will help keep consumer food price inflation under pressure throughout 2026.
Looking ahead, the medium-term risk is the forecast El Niño drought, but this may only affect the direction of 2027 food price inflation.
South Africa remains better placed than some regions of the world for now and will experience lower food price inflation in the coming months.
• Sihlobo is the Presidential Envoy on Agriculture and Land, chief economist of the Agricultural Business Chamber of South Africa, and a senior research fellow in the Department of Agricultural Economics at Stellenbosch University.
- Global food price inflation concerns have been driven by the US-Iran war, fuel and fertilizer price increases, drought and heatwaves in Europe and the Americas, and Russian attacks on Ukrainian infrastructure.
- South Africa is currently benefiting from ample agricultural output from the 2025-26 season, with consumer food price inflation slowing to 0.6% in July from 1.4% in June—the lowest since 2010.
- Cereal products in South Africa are experiencing deflation due to strong grain production, with summer grains and oilseeds forecast at a record 21.6 million tonnes, up 5% from 2024-25.
- Meat price inflation in South Africa has eased because of ongoing cattle slaughter and increased domestic supplies during foot-and-mouth disease outbreaks, while poultry production conditions remain favorable.
- South Africa is expected to maintain lower food price inflation through 2026, with medium-term risks from a forecast El Niño drought potentially affecting food prices in 2027.
Fears about the likely higher food price inflation in various parts of the world have been in the headlines for some time.
In recent weeks, Russia’s aggressive efforts to bomb key infrastructure in Ukraine have also added to the risks of higher food price inflation in various parts of the world. How all these events will affect the global food system remain to be seen in the coming year.
For now, the various regions of the world continue to benefit from the ample agricultural harvests of the previous years. Here in
Also positively, meat price inflation has slowed from recent levels, as slaughtering continues and supplies recover.
A detailed view
Now, if we zoom in on the key products, cereal (grains) products are in deflation, as we are in yet another year of better grain production.
Low food price inflation
In essence,
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