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A simple solution to help reduce food costs: grant an emergency concession at Gqeberha

30 June 2022: Concerns continue to mount over the impact of soaring food costs on vulnerable households – and rightly so.

With fuel prices set to push past the R25 litre mark and electricity hikes of up to 9.5%, both consumers and businesses are already feeling the squeeze on pockets. Add to this the impact of rising freight costs and port inefficiencies on food prices, and the net result is disaster for families.

Emphasising the devastating toll of food inflation on vulnerable households, latest statistics from the Pietermaritzburg Economic Justice and Dignity Group (PMBEJD) reveal that in the 12 months to June 2022:

  • Frozen chicken rose 14%;
  • Beef rose by 18%;
  • Fish by 11%;
  • Eggs by 14%;
  • Milk by 3%; and
  • Total household food baskets (containing 17 priority food items) rose by 14.3%.

The situation is dire, and given the negative outlook for fuel over the coming months, will only become worse. It is more urgent than ever that government and businesses join together to find practical solutions to alleviate food costs.

In our view, there is an immediate and simple solution for assisting businesses to reduce food costs: grant a State of Emergency concession at Gqeberha port.

South Africa’s ports continue to suffer extreme backlogs and congestion owing to damage to vital infrastructure and cold storage facilities at the Port of Durban caused during the April and May floods.

As a result of these delays, companies have been forced to pay thousands and even millions of rands extra in transport and storage fees, not to mention the impact of losses incurred through spoiled meat and produce.

But a key contributor to higher freight and logistics costs for food importers remains the restrictions on the number of meat unpacks that may be performed each day at Gqeberha, preventing the port from absorbing some of burden.

To facilitate the movement of goods through the port, Hume International has therefore repeatedly called on government to implement a State of Emergency concession at Gqeberha.

This concession would enable us to pay for a secondary veterinary inspector or assignee, appointed by the State, to conduct the necessary quality checks on imported food items, lifting the limitations on the number of unpacks able to be performed each day. In turn, this would reduce logistics and freight costs for our clients and, ultimately, consumers, helping to keep food prices in check. Additionally, this concession would enable us to expand our operations within the area and stimulate local job creation.

Notably, there is also a clear precedent for this type of concession, as our organisation was granted a similar concession during the July 2021 riots after two cold stores in Durban were razed and a third damaged.

Unfortunately, these calls have not yet been answered, but we will continue to engage government on the matter in the hopes of reaching a mutually acceptable solution.