Shisa Nyama index points to potential easing of food inflation in South Africa:
In a revealing Bloomberg report, the Shisa Nyama Index offers hope for South Africans grappling with rising food prices. This unique index tracks the prices of 14 essential ingredients for barbecues, or braais, a traditional South African culinary practice, across townships. The latest data shows a modest price rise of just 2.5% in February from the previous year, a significant decrease from the 6.2% increase observed a month earlier. This increase is substantially lower than the country’s official headline inflation rate of 5.3% in January and a 7% rise in food costs.
Simplifying management structure could save Eskom $7.9 billion annually:
A consultants’ report reveals that South Africa’s Eskom could prevent $7.9 billion in annual losses by simplifying its complex management structure to improve plant output and operational efficiency. The report, resulting from a nearly five-month investigation by VGBE Energy e.V., suggests decentralizing command and enhancing accountability at the plant level. It highlights corruption, equipment sabotage, and low worker morale impacting Eskom’s performance. Despite these challenges, Eskom’s transmission system was praised for its maintenance and immediate reforms urged to prevent further escalation of the crisis.
RCL Foods Announces Spin-Off and Listing of Rainbow Chicken:
RCL Foods plans to spin off its Rainbow Chicken unit and list it on the Johannesburg Stock Exchange, following a strategic review aimed at enhancing shareholder value. This announcement came alongside a report of a 52.6% increase in half-year earnings. The company aims to focus on its fast-moving consumer goods segment, having previously sold its Vector Logistics unit. The board approved the preliminary steps for Rainbow Chicken’s separation on March 1, aiming for focused growth and better capital allocation. Despite challenges like Avian Influenza, Rainbow Chicken showed strong performance, contributing to RCL’s overall revenue growth of 8.4% to R20.1 billion, driven by improved agricultural performance, cost management, and higher sales volumes.
Market:
The South African rand firmed slightly to R19.15 against the dollar early on Friday, ahead of a local purchasing managers’ index survey expected to shed light on the economy’s health. Meanwhile, stock indices dipped slightly, and the benchmark 2030 government bond yield rose marginally to 10.145%.
Week Ahead:
Today, Japan will release its Consumer Price Index (CPI), and South Africa will report its Gross Domestic Product (GDP). On Wednesday, South Africa will announce its Bureau for Economic Research (BER) Business Confidence Index, while the Bank of Canada (BOC) will make an interest rate announcement. Thursday will see South Africa disclosing its electricity consumption and production data. Finally, on Friday, China will report on loan growth, and the United States will unveil its unemployment rate and change in nonfarm payrolls.
