<\/p>\n
Fuel prices have skyrocketed this week, with petrol hitting a two-year high and diesel breaking all previous records.<\/p>\n
This is likely to impact the price of many staple foods, including bread, in the coming weeks and months.<\/p>\n
The fuel price hikes will substantially increase production prices for farmers. The price of diesel, which accounts for between 12% and 18% of the average farmer\u2019s costs, has jumped from R17.93 per litre to R25.03 per litre (wholesale price).<\/p>\n
Read:
SA fuel surcharges and supply struggles
The fuel price challenge<\/p>\n
April is a key month for the planting of grains, including wheat, so farmers will be spending far more on fuel to run agricultural machinery.<\/p>\n
Fertiliser, which is made from oil and gas byproducts and accounts for more than a third of the average farmer\u2019s costs, has become more expensive due to problems importing it from the Middle East.<\/p>\n
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Prices are further driven up because diesel trucks are used to transport goods \u2013 from unprocessed grain through to packaged bread \u2013 all along the production cycle.<\/p>\n
In a joint statement this week, representatives of GrainSA and the Fertiliser Association of Southern Africa described South Africa as \u201cparticularly vulnerable due to the country\u2019s reliance on imported fuel and fertiliser\u201d.<\/p>\n
The global price of oil has shot above $100 a barrel after US and Israeli attacks on Iran.<\/p>\n
Maritime traffic through major global transit points, like the Strait of Hormuz, has been restricted since the war began last month. Attacks on major oil producers in the Middle East, which also accounts for much of the world\u2019s fertiliser production, have restricted oil supply, driving up costs.<\/p>\n
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Iran ceasefire offers short-term relief, long-term risks remain elevated
Oil and gas prices plunge after US and Iran agree to a ceasefire<\/p>\n
South Africa hasn\u2019t seen petrol prices this high since July 2022, when Russia invaded Ukraine. In response, the government temporarily reduced fuel levies to ease the impact. It has done so again, earlier this month it reducing the petrol levy from R4.10 a litre to R1.10 and the diesel levy from R3.93 a litre to 93 cents a litre. This levy is included in the price at the pump.<\/p>\n
According to a joint statement from the Treasury and the Department of Mineral Resources, the measure is part of a broader strategy intended to \u201csupport households and key sectors of the economy\u201d.<\/p>\n
Chart produced by The Outlier in partnership with GroundUp. <\/p>\n
\u00a9 2026 GroundUp. This article was first published here.<\/p>\n
#fuel #spikes #impact #price #bread<\/p>\n","protected":false},"excerpt":{"rendered":"
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