The unmistakable aroma of shisa nyama, a South African traditional braai, fills the air every weekend across the country. However, the cost of this beloved cuisine is outpacing official inflation rates, shedding light on the harsh reality that low-income earners are bearing the brunt of economic challenges in the country.
What is the Shisa Nyama Index:
For starters, shisa nyama is a Zulu word meaning 'burn meat'', which refers to the cooking method over hot coals. Bloomberg created an innovative Shisa Nyama Index, which unveils the average price surge of a typical backyard braai in townships and rural areas. Recent data reveals that the cost of this basket of goods rose by a staggering 15% in June 2023 compared to the previous year.
The Shisa Nyama Basket:
Bloomberg's Shisa Nyama Index draws data provided by the Pietermaritzburg Economic Justice and Dignity Group (PMBEJD). This index tracks the prices of key ingredients essential for a shisa nyama, including cornmeal, onions, carrots, tomatoes, curry powder, salt, frozen chicken portions, and beef. The data collectors monitor food prices in low-income markets across major cities such as Johannesburg, Durban, Cape Town, Pietermaritzburg, Springbok, and Mtubatuba.
Source: Bloomberg, Pietermaritzburg Economic Justice and Dignity
There has been a surge in the price of a 30kg bag of maize meal, which has climbed from R264.72 to R318.47 since June last year - a substantial increase of 20%. Onions, a staple ingredient in shisa nyama, experienced a staggering 97% price surge since June. An increased input costs have forced farmers to reduce onion cultivation, according to Christo van der Rheede, CEO of Agri SA. The expectation is that the elevated prices of onions will persist for a prolonged period.
Overall food inflation slowed to 12% in May, as reported by Statistics South Africa and remains far above the target range set by the South African Reserve Bank. Governor Kganyago suggests that this sustained high inflation will require the continuation of tight monetary policies and keeping interest rates higher for longer. Contributing factors include rising global food commodity prices, a weakened rand, and persistent power cuts imposed by Eskom, the struggling state power utility.
The Shisa Nyama Index serves as a tangible representation of the practical impact of inflation in South Africa. South Africans are happier if they can enjoy and afford a braai, especially with the Rugby World Cup around the corner.