Here's how milk prices compare across SA — some people are paying less than a year ago, while others have seen big hikes

Business Insider SA

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  • The average price of a litre of long-life milk is more than 70c cheaper in Mpumalanga than in the Eastern Cape, new analysis by South African Media Insights shows.
  • This is despite the Eastern Cape producing almost 30% of South Africa's milk. 
  • Over the past year, milk prices fell in the Western Cape, while in Limpopo it rose by more than 10%.
  • For more stories, go to Business Insider South Africa.

While the Western and Eastern Cape together produce almost 60% of South Africa’s milk – locals pay among the highest milk prices in the country, a new analysis shows.

A survey by the economics platform South African Market Insights, based on data supplied by Statistics South Africa for May, shows that the average price for a litre of long-life milk was R14.99 in the Eastern Cape.

The cheapest milk – R14.27 for a litre - was in Mpumalanga, which produces only 3% of South Africa’s milk, according to government data

Here’s how milk prices compare across provinces:

  •             Mpumalanga: R14.27
  •             Gauteng: R14.28
  •             Free State: R14.34
  •             KwaZulu-Natal: R14.35
  •             North West: R14.35
  •             Western Cape: R14.49
  •             Northern Cape: R14.66
  •             Limpopo: R14.74
  •             Eastern Cape: R14.99

“While the difference between the cheapest and most expensive price per litre of milk might not look like a lot, when every single cent counts  (…) one has to start wondering why the prices charged for the same product is so different across various provinces,” SAMI observes. “Some might argue that storage, transport and the likes play a role, (but) we have long wondered about the pricing behaviour of retailers when looking at average prices of various products across provinces.”

It is curious that the Western and Eastern Cape - which produce 30% and 28% of SA’s milk, respectively - should have higher milk prices than elsewhere, given that transport costs must be much lower. Large long-life milk producers like Woodlands Dairy (which produces its First Choice brand) and Parmalat have big factories in the provinces.

Source: South Africa Market Insights/Stats SA
Source: South Africa Market Insights/Stats SA

SAMI analysis shows that while the average milk price in the Western Cape fell in the twelve months to May, it rose in the rest of the country.

This was how prices changed over the last year:

  •             Western Cape:  -0.3%
  •             KwaZulu-Natal: 1.6%
  •             Free State: 2.0%
  •             Gauteng: 4.2%
  •             Northern Cape: 4.7%
  •             Mpumalanga: 5.0%
  •             Eastern Cape: 5.2%
  •             North West: 7.9%
  •             Limpopo: 10.7%

“So the average price per litre of long life milk per province was fairly similar, but the rate of inflation over the course of the last year was vastly different across the various provinces, leading us to wonder again about pricing behaviour and price setting by retailers across various provinces for the same product," says SAMI.

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