The USDA lifted its estimate for South Africa’s 2017/18 maize production

• Last week, the United States Department of Agriculture (USDA) lifted its estimate for South Africa’s 2017/18 maize production by 2 percent from last month to 13.8 million tonnes. While above average production of 12.5 million tonnes, this is lower than the previous season’s record harvest of 17.6 million tonnes due to a decline in area planted and expectations of average yields in some areas.
• This is in line with the local Crop Estimate Committee’s estimate for overall production (commercial and non-commercial). The non-commercial production, which is subsistence farming accounts for a 4 percent share in the estimated harvest of 13.8 million tonnes.
• The key message from these numbers is that South Africa’s maize market will be well supplied in the 2018/19 marketing year. The total maize supplies could reach 16.7 million tonnes, well above the local demand of 10.8 million tonnes, according to data from the national Supply and Demand Estimates Committee. The supplies figure includes an opening stock and expected production.
• This essentially means that South Africa’s 2018/19 marketing year maize exports could, at least, amount to 2.5 million tonnes, slightly lower than the volume exported in 2017/18. Most importantly, this suggests that the SAFEX maize prices could remain at relatively lower levels for some time, all else being equal.
• On the ground, the harvest process is gaining ground, albeit having started late this year due to delayed planting earlier in the season. Total maize deliveries for the first 10-weeks of the 2018/19 marketing year are estimated at 5.1 million tonnes, which equates to 39 of the estimated commercial harvest of 13.2 million tonnes.

Click HERE to read the full report by Wandile Sihlobo