Highlights in today’s morning note
The eastern Free State regions such as Frankfort, Vrede, Heilbron, and Fouriesburg received rainfall of between 08 and 20 millimetres on Tuesday, 14 November 2017. At the same time, Davel, Ermelo, Hendrina, Lydenburg, Morgenzon, Witbank, Standerton, Ogies and Bethal regions of Mpumalanga province received rainfall varying between 10 and 36 millimetres.
The forecast for the next two weeks promises continuous rainfall across the South African maize belt. This should improve soil moisture and potentially benefit the new season crop, albeit slowing the planting activity.
Although the focus is in the new production season, some farmers continue to deliver old season maize to commercial silos. The total maize deliveries were reported at 17 384 tonnes in the week ending 10 November 2017, which is 16% higher than the previous week’s deliveries. About 68% of this was white maize, with 32% being yellow maize.
Overall, South Africa’s 2017/18 market year total maize deliveries for “week 1 to 28” currently stand at 14.99 million tonnes. Of this total, 60% is white maize with 40% being yellow maize.
As indicated in yesterday’s note, the Western Cape province could receive rainfall of between 16 and 35 millimetres within the next eight days. This might delay the harvest process which is currently in full swing across the province, but unlikely to damage the quality of the crop.
Farmers have made notable progress regarding the harvest process. About 217 388 tonnes of wheat was delivered to commercial silos in the week ending 10 November 2017. This placed the country’s producer deliveries for “week 1 to 6” of the 2017/18 marketing season at 346 730 tonnes.
Apart from anticipations of harvest delays, the expected rainfall in the Western Cape province is a welcome development given that the province’s dam levels are critically low. The most recent update for the week ending 13 November 2017 shows that dams averaged 35%, down by 1% from the previous week and 23% lower than the corresponding period last year.
The rainfall coverage in the western parts of the country, which predominantly plant sunflower seed, have been limited. However, the forecast for the next two weeks promises a chance of good rainfall in the region. This should improve soil moisture and benefit the crops. As previously noted, South African farmers intend to increase sunflower seed plantings by 5% year-on-year to 665 500 hectares in the 2017/18 production season.
With almost nothing on the data calendar, the sunflower seed price movements for the rest of the week will largely be driven by developments in the currency market, as well as traded volumes in the domestic front.
In the global market – According to the International Grains Council, Egypt purchased 32 500 tonnes of sunflower oil from the optional origin. Moreover, Ukraine continues to see good exports to the global market. Between 01 and 13 November 2017, the country exported 148 300 tonnes of sunflower oil and 127 600 tonnes of sunflower meal.
In the fields, the harvest process is almost complete. On 15 November 2017, Russia and Ukraine had harvested 75% and 99.5% of this season’s sunflower seed crop, respectively.
SUNSEEDMAN forecasts Russia’s 2017/18 sunflower seed production at 11.5 million tonnes, down by 3% from the previous season. At the same time, Ukraine’s harvest is set to decline by 7% y/y to 14.0 million tonnes.
The South African potato prices remained in negative territory in yesterday’s trade session due to the large daily stock of 982 635 pockets (10kg bag) at the start of the session. The price was down by 3% from the previous day, closing at R34.86 per pocket (10kg).
Moreover, during the session, the market saw an uptick in deliveries on the back of ongoing harvest activity. This subsequently led to a 10% increase in daily stocks to 1.08 million pockets (10kg bag).
The fruit market ended the day mixed in yesterday’s trade session. The bananas market was under pressure due to relatively large stocks of 224 000 tonnes, as well as commercial selling. The price down by 3% from the previous day, closing at R6.31 per kilogram.
Meanwhile, the prices of apples and oranges were up by 3% and 13% from the previous day, closing at R8.00 and R6.27 per kilogram, respectively. These gains were mainly on the back of relatively lower stocks of 205 000 tonnes of apples and 52 000 tonnes of oranges.
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