(MENAFN- The Post) Customers should brace themselves for more pain next week. Lesotho Flour Mills has announced a 15 percent price hike on all maize products with effect from Monday.
The hike comes less than a month after the country's biggest milling company announced a seven percent price increase on mealie-meal and Samp, which are all basic commodities.
Chief executive Fourie Du Plessis told customers in his latest statement that the adjustment is due to a further surge in the price of raw white maize.
Du Plessis said there had been a 39 percent increase in the price of raw white maize between January 31 and March 31.
He said the spike is“attributed to the adverse effects of the drought caused by low rainfall and hotter than usual weather during the past season”.
Du Plessis said when they announced the seven percent increase in April they were“hopeful” that“raw white maize prices would stabilise during April following rainfall late in the season”.
“Unfortunately, the rainfall was too late to impact the crop yields and prices surged further up to levels of M5.500 per metric ton during the past week,” Du Plessis said.
In his March statement, Du Plessis warned customers to expect“further price increases in early May, with wholesale prices projected to reach up to M8, 800 per metric ton.”
The increase in the price of raw white maize is likely to have a knock-on effect on many other products in its value chain.
Because Maize is the anchor raw for animal feed, there is likely to be an increase in the prices of all protein.
The drought, which has devastated crops in the entire Southern Africa, has also triggered steep increases in the prices of other basic commodities.
The increases are a continuation of a trend that started during the Covid-19 pandemic when bottlenecks in the global value chain stifled production.
The Russia-Ukraine war made the situation worse. So has the power crisis that has hit productivity in South Africa.
The trouble has been unrelenting for customers, most of whom have squirmed as their meagre earnings have been eroded by inflation and continue to lag behind the galloping prices of basic commodities. Just this week the Petroleum Fund announced an increase in fuel prices.
A few weeks ago it was the Lesotho Electricity Company announcing a 9.6 percent increase in power tariffs. Other producers of basic products have quietly reviewed their prices to keep up with the increase in production costs.
Alarmed, the opposition has called on the government to subsidise basic commodities.
The government is yet to respond but pressure is mounting on it to intervene.
Nkheli Liphoto
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