Spotlight on SA soybean production

• The next eight days should remain cool and dry over the soybean growing areas, which should be supportive of the harvest process. This is at initial stages in parts of the Mpumalanga province, and it could soon commence in other provinces as a large part of the crop has already matured.Agbiz Morning Market Viewpoint on Agri-Commodities 26 April 2018 
• The soybean crop is in good condition throughout the country and this is demonstrated in the CEC’s decision to revise South Africa’s 2017/18 soybean production estimate up by 3 percent from the previous season to 1.4 million tonnes (see Chart below). This is underpinned by expected higher yields, as well as an increase in area planted. The key soybean-growing provinces are Free State, Mpumalanga and KwaZulu Natal making up a combined share of 87 percent. The other notable soybean-producing province is Gauteng and North West with a combined share of 8 percent.
• This expected large crop implies that South Africa’s soybean market will be well-supplied in the 2018/19 marketing year. The seasonal imports could decline by 27 percent year-on-year to 20 000 tonnes. This is a notable improvement following imports of 271 098 tonnes in the 2016/17 marketing year. Moreover, we estimate that in 2018, soybean oilcake imports could decline by 17 percent from last year to 458 992 tonnes. This too is a remarkable improvement from imports of close to a million tonnes in 2010.
• Aside from production aspects, the most recent data from SAGIS shows that South Africa’s soybean stocks were at 261 613 tonnes in March 2018, which is almost double the volume seen in the corresponding period last year. Also worth noting is that soybean consumption (crushed oil and cake) was at 74 282 tonnes in March 2018, down by 20 percent from the corresponding period last year.
• Using an estimate of 2.2 million tonnes of South Africa’s soybean crushing capacity, which equates to 183 333 tonnes per month, the country utilised 41% of its monthly soybean processing capacity in March 2018, down by 2 percentage points from the previous month and 10 percentage points from the same period last year.

Chart: South Africa’s soybean production

Source: SAGIS, CEC, Agbiz Research

Full report by Wandile Sihlobo below:

Agbiz Morning Market Viewpoint on Agri-Commodities 26 April 2018