Agricultural market viewpoint – Agri Limpopo

South African Agricultural Market Viewpoint: 11 March 2019

Deidre Carter — Mon, 11 Mar 2019 06:54:38 +0000

The recent World Agricultural Supply and Demand Estimates report by the United States Department of Agriculture (USDA) provides further evidence that the world will have fairly large maize, soybean, and rice supplies in the 2018/19 season. Meanwhile, wheat production could decline from levels seen in the 2017/18 season.
For South Africa, the relevance of this is through a number of channels, with the most direct one being that the country is a net importer of rice and wheat. South Africa’s 2019 rice imports could amount to 1.1 million tonnes, up by 10% from 2018. Meanwhile, wheat imports could fall by 36% from the 2017/18 season to 1.4 million tonnes.
Also, it is worth noting that after being a net importer for two consecutive seasons, South Africa could again be a net exporter of sorghum in the 2019/20 marketing year, which commences on 01 May 2019 (this corresponds with the 2018/19 production season).

Deidre Carter — Mon, 01 Apr 2019 07:15:43 +0000

While it remains a challenge to get a clear picture of the scale of damage in maize fields in Mozambique and Zimbabwe after Cyclone Idai, we suspect that these countries will collectively have to import over a million tonnes of maize in the 2019/20 marketing year in order to fulfil the domestic needs.
Given that the key maize-producing countries in Southern Africa – Zambia and South Africa – are expecting a poor harvest in 2018/19 production season, maize supplies will be tight in the region the 2019/20 marketing year, and this could present upward pressures on prices.
But there will not be a disaster. There are large maize supplies in the global market which the region can draw from, although it is largely yellow maize. The price will, however, be an issue partly due to strong global demand.
Aside from summer grains, a few weeks back we signalled a possibility of favourable weather conditions over the south-western parts of South Africa, which would ultimately benefit winter crops. On 28 March 2019, the local weather bureau reaffirmed its view that between April and July 2019, the south-western parts of South Africa could receive above-normal rainfall.

Deidre Carter — Mon, 08 Apr 2019 07:08:34 +0000

The changing perceptions about cannabis around the globe, and its growing value raises a question of whether South Africa should put concerted effort into research on this crop so that policymakers can better assess if its production benefits could be balanced by measures to mitigate unintended consequences.
From a data perspective, in March 2019 the International Grains Council kept its estimate for South Africa’s 2018/19 maize production unchanged from the previous month at 10.7 million tonnes. This is down by 14% from the 2017 /18 harvest due to a reduction in area planted and expected poor yields in some areas, but marginally higher than the Crop Estimates Committee’s (CEC) estimate for the 2018/19 production season. While this is a welcome development, we remain concerned about maize yield expectations in the western parts of South Africa owing to dryness experienced in February and March.
South Africa’s weekly grain trade data is due for release on Thursday, 11 April 2019. This will mainly be maize and wheat. In terms of maize, we expect South Africa to be a net exporter in 2018/19 and 2019/20 marketing years, with about 2.3 million tonnes (white and yellow maize) and 1.1 million tonnes, respectively.
In terms of wheat, South Africa could remain a net importer in 2018/19 marketing year, but imports could fall by 36% year-on-year decline to 1.4 million tonnes.