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Meat has grow to be the largest driver of meals inflation.
The outbreak of foot-and-mouth illness (FMD) in South Africa has led to a major enhance in meat costs over the previous three months.
FMD is a extremely contagious viral illness of livestock that has a major financial influence. The illness impacts cattle, swine, sheep, goats and different cloven-hoofed ruminants.
Over the previous months, SA has seen outbreaks in Gauteng, Limpopo, the Eastern Cape and the Free State. Recently, the division of agriculture lifted restrictions within the Eastern Cape and Limpopo provinces after implementing intensified efforts to include the unfold of the illness.
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Meat costs
Paul Makube, senior agricultural economist at FNB Commercial, stated meat was the largest driver of meals inflation, surging to a 25 month excessive of 6.6% year-on-year (y/y) and rising by 2.2% month-on-month (m/m) in June 2025.
“The disease-induced provide constraints underpinned the upswing in meat costs prior to now three months,” he stated.
Due to the illness outbreak, there was a brief provide of livestock, primarily cattle. This resulted in meat changing into dearer.
Meat underneath menace
Makube added that whereas farmers had been attempting to manage the FMD outbreak, the poultry trade additionally skilled a scarcity menace.
An outbreak of avian flu, also referred to as chicken flu, in Brazil let to imports from the nation being banned. Bird flu is a contagious viral illness that impacts each home and wild birds.
The ban induced panic available in the market, as Barzil is the foremost supply of mechanically deboned meat (MDM), which is used within the manufacturing of merchandise corresponding to polony and viennas. “SA is a internet importer of MDM as a consequence of lack of home capability,” Makube stated.
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Ban lifted
However, the division of agriculture and the Brazilian authorities got here to an settlement and partially lifted the ban.
Chicken from states in Brazil that haven’t skilled the outbreak of chicken flu can export hen to SA. Makube stated this transfer may ease stress on hen costs within the medium time period.
“While the FMD state of affairs stays sticky with new outbreaks reported within the Free State and persisting in KZN, latest developments are that slaughtering has resumed in main feedlots with producer costs already off the boil early in July 2025”.
Food inflation
He added that South Africa’s meals inflation edged increased to three% y/y in June 2025 relative to May’s 2.8% y/y, underpinned by positive aspects in core objects and meals and non-alcoholic drinks (FNAB), however nonetheless got here under expectations of a 3.1% spike.
“Our evaluation of the FNAB reveals a 0.3 proportion level bounce from the May stage to five.1% y/y in June. The meals sub-index rose by the identical margin from the earlier month to 4.7% y/y choked by meat.
“However, month-to-month, meals inflation slowed from 1.2% m/m in May to 0.7% m/m in June 2025, led by the fruits and nuts subcategory, which declined for the fourth consecutive month to -2.4% m/m.”
The future
“In phrases of the meals inflation outlook, draw back dangers embrace a persistent rand trade fee appreciation, weak worldwide crude oil costs, bulging international grains shares outlook (+586 million tons) and the ensuing draw back stress on costs, in addition to the potential restoration in livestock slaughter charges if the FMD state of affairs dissipates additional.”
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