News / Local
Basic goods prices gallop in Zimbabwe
02 Jun 2022 at 01:43hrs | Views
Bulawayo residents have called for Government controls as prices of basic commodities are increasingly getting out of reach for the majority of citizens, with retailers having adopted different foreign currency exchange rates.
For the past few weeks, prices of basic commodities have been skyrocketing, amid concerns that this is influenced by parallel market exchange rates and profiteering.
To cushion consumers from price shocks occasioned by geopolitical developments in Europe and local speculative behaviour, Government recently suspended duty on basic commodities including cooking oil, sugar and maize meal.
While the official US to Zimbabwe dollar rate is at US$1: $308,5, supermarkets such as Greens, Cover and Oceans have pegged their prices using rates of between US$1: $400/$450.
While in the past, shoppers could just walk into any shop and buy groceries as there were hardly any price differences from one shop to another, the situation has changed due to pegging of prices using black market rates.
For example, products such as 1kg of powdered milk are sold from $1 500 up to $4 000 depending on the shop.
At OK supermarket yesterday, the rate was pegged at US$1: $298 and at Zapalala it was US$1: $400; at Choppies US$1:$370 and at Greens US$1: $420.
Cover Supermarket situated along 12th Avenue extension between Fife Street and George Silundika has its products priced in US dollar and Rands only, although it accepts local currency at US$1 is to $450, the same as Oceans Supermarket.
OK and Choppies had the lowest prices for 2kg rice at just over $600 while Pick n Pay, Greens and Spar sold the same for $800.
The cheapest 2l of cooking oil was sold for $2 100 at Choppies while at shops such as Zapalala and Greens it cost $2 800.
A 10kg pack of Amandla roller meal was the cheapest mealie-meal on the shelves as it was sold for $1 900 at most of the shops.
Members of the public expressed concern over the ever-increasing prices of basic commodities saying there is a need for Government to intervene.
Residents said as prices of basic commodities are going up, salaries remain stagnant.
Mr Mhlupheki Sibanda who lives in Bulawayo's city centre said price hikes were eroding incomes.
"I'm worried about the price increases for most basic commodities. There is nothing that is affordable, we are struggling to survive and there is no money. There is a need for Government to intervene because we don't see things changing. As for me, I'm more worried about young people, they won't even be able to buy properties," said Mr Sibanda.
Mrs Nomusa Nkosi said of concern is that the prices have doubled from last month.
"I'm just from buying a few goods and the prices have increased so badly. I remember we were discussing with my husband that bathing soap that we bought last month for $250 is now $500. All the basic commodities have gone up. A solution needs to be identified in resolving this problem. Our salaries are not increasing yet the prices keep going up," said Mrs Nkosi.
The Consumer Council of Zimbabwe has decried the price madness, saying consumers need to be more vigilant as they conduct their shopping. CCZ spokesperson Mr Chris Kamba said rising costs of basic commodities points to profiteering.
He said a family of six now requires $120 000 for food per month.
"From a consumer point of view price disparities are good and bad, good in that they encourage competition amongst players. On the other hand, they highlight greedy and profiteering tendencies from some players in the value chain," said Mr Kamba.
He said CCZ has since created social media groups where they advise consumers where they can get affordable products.
Confederation of Zimbabwe Retailers (CZR) president Dr Denford Mutashu said the price hikes are partly caused by manufacturers who demand payment in foreign currency.
"Retailers end up buying foreign currency from the black market because producers at the moment don't accept payment in local currency. So as retailers it's difficult to make a profit if we buy in foreign currency and then sell in local currency. Consumers want cheap commodities, but the availability of foreign currency is affecting the retail price and that is why there are price disparities," said Dr Mutashu.
He said to arrest price increases, the country needs to scale up production.
Confederation of Zimbabwe Industries (CZI) president Mr Kurai Matsheza said foreign currency demand was fuelling the price increases.
"Businesses access the foreign currency partly from the auction and also from the parallel market as we may all know that the auction is not giving 100 percent requirement. Thus, a blended level of forex is different from business to business and hence different rates by retailers," he said.
Mr Matsheza said the impact of the Russia-Ukraine conflict was also affecting commodity prices in the country.
"Commodities such as wheat, cooking oil, gas, fuel and oil are some of the commodities that have been affected. As you may know, the level of global supply from the two countries is as high as 40 percent and a disturbance of 40 percent is a huge gap.
The longer the conflict takes, the more damage is going to be felt by the global economy. Zimbabwe is thus caught in this situation as we are reliant on importation of these commodities. Therefore, as a country we are not immune to these shocks," said Mr Matsheza.
For the past few weeks, prices of basic commodities have been skyrocketing, amid concerns that this is influenced by parallel market exchange rates and profiteering.
To cushion consumers from price shocks occasioned by geopolitical developments in Europe and local speculative behaviour, Government recently suspended duty on basic commodities including cooking oil, sugar and maize meal.
While the official US to Zimbabwe dollar rate is at US$1: $308,5, supermarkets such as Greens, Cover and Oceans have pegged their prices using rates of between US$1: $400/$450.
While in the past, shoppers could just walk into any shop and buy groceries as there were hardly any price differences from one shop to another, the situation has changed due to pegging of prices using black market rates.
For example, products such as 1kg of powdered milk are sold from $1 500 up to $4 000 depending on the shop.
At OK supermarket yesterday, the rate was pegged at US$1: $298 and at Zapalala it was US$1: $400; at Choppies US$1:$370 and at Greens US$1: $420.
Cover Supermarket situated along 12th Avenue extension between Fife Street and George Silundika has its products priced in US dollar and Rands only, although it accepts local currency at US$1 is to $450, the same as Oceans Supermarket.
OK and Choppies had the lowest prices for 2kg rice at just over $600 while Pick n Pay, Greens and Spar sold the same for $800.
The cheapest 2l of cooking oil was sold for $2 100 at Choppies while at shops such as Zapalala and Greens it cost $2 800.
A 10kg pack of Amandla roller meal was the cheapest mealie-meal on the shelves as it was sold for $1 900 at most of the shops.
Members of the public expressed concern over the ever-increasing prices of basic commodities saying there is a need for Government to intervene.
Residents said as prices of basic commodities are going up, salaries remain stagnant.
Mr Mhlupheki Sibanda who lives in Bulawayo's city centre said price hikes were eroding incomes.
"I'm worried about the price increases for most basic commodities. There is nothing that is affordable, we are struggling to survive and there is no money. There is a need for Government to intervene because we don't see things changing. As for me, I'm more worried about young people, they won't even be able to buy properties," said Mr Sibanda.
Mrs Nomusa Nkosi said of concern is that the prices have doubled from last month.
"I'm just from buying a few goods and the prices have increased so badly. I remember we were discussing with my husband that bathing soap that we bought last month for $250 is now $500. All the basic commodities have gone up. A solution needs to be identified in resolving this problem. Our salaries are not increasing yet the prices keep going up," said Mrs Nkosi.
The Consumer Council of Zimbabwe has decried the price madness, saying consumers need to be more vigilant as they conduct their shopping. CCZ spokesperson Mr Chris Kamba said rising costs of basic commodities points to profiteering.
He said a family of six now requires $120 000 for food per month.
"From a consumer point of view price disparities are good and bad, good in that they encourage competition amongst players. On the other hand, they highlight greedy and profiteering tendencies from some players in the value chain," said Mr Kamba.
He said CCZ has since created social media groups where they advise consumers where they can get affordable products.
Confederation of Zimbabwe Retailers (CZR) president Dr Denford Mutashu said the price hikes are partly caused by manufacturers who demand payment in foreign currency.
"Retailers end up buying foreign currency from the black market because producers at the moment don't accept payment in local currency. So as retailers it's difficult to make a profit if we buy in foreign currency and then sell in local currency. Consumers want cheap commodities, but the availability of foreign currency is affecting the retail price and that is why there are price disparities," said Dr Mutashu.
He said to arrest price increases, the country needs to scale up production.
Confederation of Zimbabwe Industries (CZI) president Mr Kurai Matsheza said foreign currency demand was fuelling the price increases.
"Businesses access the foreign currency partly from the auction and also from the parallel market as we may all know that the auction is not giving 100 percent requirement. Thus, a blended level of forex is different from business to business and hence different rates by retailers," he said.
Mr Matsheza said the impact of the Russia-Ukraine conflict was also affecting commodity prices in the country.
"Commodities such as wheat, cooking oil, gas, fuel and oil are some of the commodities that have been affected. As you may know, the level of global supply from the two countries is as high as 40 percent and a disturbance of 40 percent is a huge gap.
The longer the conflict takes, the more damage is going to be felt by the global economy. Zimbabwe is thus caught in this situation as we are reliant on importation of these commodities. Therefore, as a country we are not immune to these shocks," said Mr Matsheza.
Source - The Chronicle
