They bake over 1 000 loaves of bread a week to feed 2 500 children and families in their community but a 60% rise in flour prices is causing worry. The bakers of the non-profit organisation Children of Destiny at Home say their work is severely hampered by a global food price avalanche that was triggered by Russia’s invasion of Ukraine.
The latest development to drive up global food prices is India’s decision last week to halt wheat exports. India is the eighth largest wheat exporter in the world and is trying to safeguard its domestic and regional food supply.
This spells trouble for the community bakery in the Mpumalanga township of Hammarsdale. Operations manager Hlengiwe Gumede says that they are already being squeezed by rising food prices.
“To be honest, since Covid-19 and the Russia-Ukraine war we have been experiencing tough times. Prices have gone up, making it difficult for us as a non-profit organisation that is reliant on donors to keep feeding the community.
“We used to buy our [bags of] flour at about R99. Now it has gone to R160, making it difficult for us to do our work.”
What used to be enough, no longer is
The bakery is situated on the grounds of Children of Destiny at Home and was started with money that Gumede and her team raised to buy bakery equipment.
Since then, the bakery has cut their bread budget by 50%. They fear that the tough economic environment will let them spend more than save. “The impact of the global matters… we feel them [in] the rising costs of inputs that we need to do the bread and feed the hungry in our community.
“It is really hitting home. With the high prices of food we have to see how, with the little money we get, we can stretch it out so we can continue… feeding the community.”
“If you are given R2 000 as a donation, you really do not know what to buy anymore because everything has [gone] up and will continue going up,” a notably frustrated Gumede says.
Wheat ban could lead to hunger
Agri SA executive director Christo van der Rheede warns that countries who institute export bans are disrupting the smooth-running value chain that had previously existed in the market, and could lead to major problems in many countries.
Van der Rheede believes these bans will cause more harm than good and could exacerbate world hunger if not treated with the urgency it deserves.
“We need different and more innovative government support measures to prevent a situation where people go hungry.
“I think that should be the focus: to avoid worldwide hunger, because that will lead to massive social instabilities. Stopping any wheat export from any country will acerbate the hunger problem we have in the world,” he says.
Van der Rheede advocates that the free-market system of voluntary exchange, based on supply and demand, should continue without government intervention.
He believes that global markets must remain open in full to ensure fair competition. “We are of the opinion that world markets need to remain open; that we should not be banning any export from any country. There are enough wheat stocks throughout the world. There are also enough maize stocks.”
A grain farmer in the Free State, Happy Letsitsa, shares Van der Rheede’s worry about food shortages, but also expresses sympathy for affected farmers.
“The banning will have an immense impact on all the countries affected because the wheat prices might start to skyrocket. For the exporters of wheat from India that is not good news at all. They are being dealt a blow.”
Agbiz chief economist Wandile Sihlobo warns that the world is starting to see a second round of export bans of key commodities since Russia’s invasion of Ukraine, all with the aim of protecting domestic customers against food shortages and exorbitant prices.
Van der Rheede tells Food For Mzansi that farmers in South Africa are already making plans to produce more wheat this season.
ALSO READ: Oil shortage: SA oilseed farmers set on planting more
Sign up for Mzansi Today: Your daily take on the news and happenings from the agriculture value chain.
