The new Shisa Nyama Index shows how South Africa’s poor suffer when prices rise faster than inflation

  • The cost of the typical fare that makes up a Shisa Nyama is increasing faster than official inflation.
  • Bloomberg’s new Shisa Nyama Index shows that the median price is up 11% year-on-year.
  • This underscores the stark reality that low earners suffer the most in SA.
  • For more financial news go to News24 Business front page.

On any given weekend in South Africa, the smell of shisa nyama – the Zulu term for traditional barbecue – wafts through cities, townships and rural areas.

But the cost of the typical fare that makes up a shisa nyama is rising faster than official inflation, underscoring the stark reality that low-income earners suffer most in South Africa – one of the world’s most unequal countries.

Bloomberg’s new Shisa Nyama Index shows that the average price of a barbecue in Soweto, a black community on the outskirts of Johannesburg, is up 11% year-on-year. This compares to a 7.6% yoy increase in consumer prices in October, as measured by Statistics South Africa.

Based on data from the Pietermaritzburg Economic Justice and Dignity (PMBEJD) Group, the index tracks the prices of some of the key ingredients in a shisa nyama — cornmeal, onions, carrots, tomatoes, curry powder, salt, frozen chicken portions, beef, and wors — a type of sausage, which is made from various minced meat leftovers.

To compile their survey, PMBEJD’s data collectors track food prices on the shelves of 44 supermarkets and 30 butcher shops targeting the low-income market in the larger areas of Johannesburg, Durban, Cape Town, Pietermaritzburg and the northwest city of Springbok.

The Index is a window into the impact of inflation on South Africa’s most vulnerable consumers, with even the cost of onions rising faster than fuel prices. The price of the stunning vegetable is up 23% month-on-month and 78% in a year. In the 12 months, diesel costs increased by 53%.

“I pay 120 rand (US$7) for 10 kilograms of onions now, where it used to be between 39 and 50 rand and I don’t know why, it’s not like they’re from Russia,” said Oyama Ndaliso, the Owner of Papa Ron’s Shisa Nyama in Woodstock, a low-income Cape Town suburb.

“In the store now I have to sell two sizes of stew because people can’t afford that much, so they go for smaller portions.”

The rise in South Africa’s cost of living is fueling public anger over record blackouts, rampant unemployment and poverty. It increases the risk of a repeat of deadly riots that broke out in two provinces last year and claimed 354 lives.

“Inflation always has the biggest impact on the poor,” said Frank Blackmore, chief economist at KPMG. “The reason is that they have no way of delaying spending. Most of the income the poor earn is needed for immediate consumption. This contributes to a potentially awkward situation. “

The total cost of buying all the materials in bulk to prepare a shisa nyama for friends and family is up 24% to R1,756, from R1,414 in January 2021. While that figure may seem cheap after a currency conversion, it is the best to compare with South Africa’s national minimum wage, at which a general worker would have earned 3,895.92 Rand according to the PMBEJD survey in October.

To adapt and stick with customers, retailers like South Africa’s Pick n Pay Stores Ltd. plan to more than double the pace of opening low-cost grocery and clothing stores next year. It’s the same strategy used by Shoprite Holdings Ltd., Africa’s largest and typically low-cost supermarket chain, which has invested in local businesses to combat increasing competition.

Ndaliso, who opened his Shisa Nyama branch during the worst of the coronavirus pandemic and is now starting to break even, had to innovate and find new markets to survive.

“Luckily we signed up for Uber Eats,” he said. “Shisa nyama is in high demand and people who vacation here order from their hotels. Covid has been good for me because I had no choice. I was retired so I took all my money and opened this restaurant. That was brave – it was my last money.”

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