wheat import – Agri Limpopo

SA’s wheat import tariff revised down to R394.85 per tonne

Deidre Carter — Mon, 09 Apr 2018 10:34:24 +0000

South Africa’s wheat import tariff has been revised to R394.85 per tonne, which is a 45% decline from the previous rate of R716.33 per tonne (see Chart below). This new duty was calculated on the 13 February 2017 following an upsurge of the international wheat prices but only published in the Government Gazette to make it official on Friday evening.

The adjustments in the wheat import tariff are satisfied when the international wheat price (US No.2 HRW) deviates from the base price by more than US$10 per tonne for three consecutive weeks. From the week ending 30 January to 13 February, the international wheat prices consistently traded above US$235 per tonne, making a deviation of US$10 per tonne above the base price of then US$218 per tonne. Thus, leading to a downward revision of the import tariff.

During this period the international wheat prices were partly supported by concerns that drier weather conditions in the southern Plains of the US could negatively affect the harvest. The International Grains Council (IGC) forecasts US 2017/18 wheat production at 47.4 million tonnes, down by 25% from the previous season.

Nonetheless, the global market is well supplies, following an uptick in production in India and the Black Sea region. IGC forecasts 2017/18 global wheat production at 758 million tonnes, up by a percentage point from the previous season. This implies that the international wheat prices could trade sideways in the near to medium term. In the week ending 03 April 2018, the international wheat prices traded at levels around US$237 per tonne.

It is also worth noting that the wheat import tariff has triggered again on 20 March 2018 to R293.74 per tonne, down by 25% from the current rate of R394.85. The newly calculated rates will only be applicable after publication in a government gazette. The timeframe for this process is unclear. The previous adjustments took more than three weeks.

Chart: South African wheat import tariff

Source: SAGIS, Agbiz Research

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Key wheat importers in sub-Saharan African region

Arithmus — Tue, 17 Apr 2018 10:29:04 +0000

Yesterday we indicated that sub-Saharan Africa’s 2017/18 wheat imports could reach 26 million tonnes, up by 18 percent from the previous season. What we didn’t mention is that the leading wheat importers within the sub-Saharan African region are Nigeria, Sudan, South Africa, Kenya, Ethiopia and Côte d’Ivoire, with imports estimated at 5.1 million tonnes, 2.5 million tonnes, 1.9 million tonnes, 1.7 million tonnes, 1.3 million tonnes and 700 000 tonnes, respectively (see Chart below).
In the case of South Africa, the 2017/18 marketing year’s wheat imports currently stand at 1.2 million tonnes, which equates to 63 percent of the seasonal import forecast of 1.9 million tonnes. In the past few weeks, however, the imports were sluggish. The last consignment was received on the week ending 16 March 2018.
The slow import activity was either partially influenced by the delays in wheat tariff adjustments or mainly weak demand, or both. The wheat import tariff which triggered on 13 February 2018 to R394.85 per tonne, which is a 45 percent decline from the previous rate of R716.33 per tonne, but was only published on the Government Gazette to make it official on 06 April 2018.
The week ending 13 April 2018 was the first with the tariff at the new rate of R394.85 per tonne. SAGIS will release the weekly trade data for this particular week at midday, which should give us a sense of whether a relatively lower import tariff will stimulate imports or could remain sluggish for some time.

Chart: Key wheat importers in sub-Saharan African region

Source: USDA, IGC, Agbiz Research

Full report by Wandile Sihlobo attached below:

Agbiz Morning Market Viewpoint on Agri-Commodities 17 April 2018

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Trade aspects to remain a key focus in local wheat market

Arithmus — Thu, 19 Apr 2018 07:35:36 +0000

Trade aspects remain an important factor in the market as South Africa is a net importer of wheat (see Chart below). The wheat import tariff has triggered again on 10 April 2018 to R437 per tonne. The previous trigger was on 20 March 2018, which then, was calculated at R293.74 per tonne, after an uptick in international wheat prices (No2 HRW), which were supported by unfavourable weather conditions in the US wheat growing regions.
However, these rates are not yet applicable. The current import tariff is R394.85 per tonnes. The newly calculated rates will be applicable after publication in a government gazette, of which the timeframe is unclear. The import tariff will expectedly decline to R293.74 per tonne first and then increase to R437.25 per tonne.
As indicated in yesterday’s note, there were no wheat imports last week. The last imports were in the week of 16 March 2018, recorded at 25 135 tonnes. This placed 2017/18 marketing year’s wheat imports at 1.2 million tonnes, which equates to 63 percent of the seasonal import forecast of 1.9 million tonnes.

Chart: South Africa’s wheat imports as a share of local (wheat) consumption

Source: SAGIS, SASDE, Agbiz Research

Read the full report by Wandile Sihlobo in the attachment below:

Agbiz Morning Market Viewpoint on Agri-Commodities 19 April 2018

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