Dr Frikkie Maré, academic head of the Department of Agricultural Economics at the University of the Free State (UFS), provides a monthly agri market overview of the previous month’s agricultural markets. This is the overview for September 2019.
The price of yellow maize weakened during the first few days of September, before strengthening as the rand declined against main currencies. The market closed at R2 722/ton.
The rand strengthened at the beginning of September, before weakening towards the end of the month. The currency traded at R15,10 and R16,49, respectively, against the dollar and euro at the end of the month.
During September, the consumer price index (CPI) increased to 4,3% year-on-year (y/y), while the producer price index (PPI) decreased to 4,9% y/y. The prime rate remained the same at 10%. The economic growth for the second quarter of 2019, as prescribed by the GDP, increased to 0,9% y/y. The economy also grew by 3,1% quarter-on-quarter.
Red meat market
The market for all three grades of beef carcasses showed further sideways movement in September, with prices following a downward tendency. The price of mutton declined in all three grades of carcasses.
The last available prices for beef in September were R45,77/kg for A2, R38,72/kg for B2 and R36,96/kg for C2. The last available prices for A2, B2 and C2 lamb and sheep carcasses were R65,94/kg, R50,31/kg and R49,03/kg, respectively.
In the case of weaner animals, the price of lamb fell substantially while the price of beef strengthened. The last available prices were R28,93/kg for calves and R32,67/kg for lambs. The prices of hides and skins also showed further sideways movement.
Wool and mohair market
The wool market is eventually thriving after a few low auctions at the start of the season. The mohair market declined during the same period. The clean wool indicator increased by 5,3% at the last auction of September, but is still trading 47,3% lower than last year. The mohair indicator price weakened by 0,2% compared to the previous auction. It also traded 31,8% lower than last year.
The PPI of milk and eggs showed a slight decline in September, while the index of milk products improved. The CPI of milk, eggs and cheese increased during the same period.
Click here to read Augusts market overview. – Dr Frikkie Maré