Wandile Sihlobo, Agbiz

We rarely explore developments in Mozambique’s agricultural sector as that country is not a key contributor to the production of Southern Africa’s staple foods: maize, sorghum and wheat. But the devastation caused by Tropical Cyclone Idai means that Mozambique should not be overlooked this year because of its possible food needs in the coming months.

Mozambique is generally a net importer of grains, such as maize, wheat and rice, although imported maize volumes are smaller. In a normal season, the country imports roughly 100 000 tons of maize, 700 000 tons of rice and 680 000 tons of wheat, to meet its domestic needs.

In the case of rice, the key suppliers are typically Thailand, Pakistan, Vietnam and China. Apart from Pakistan, these countries are expecting an uptick in this season’s rice production which means there will be fairly large supplies in the global market.

Russia, Germany, Canada and Poland are generally Mozambique’s leading suppliers of wheat. While some of these countries could experience a decline in their wheat harvests in the 2018/19 production season, there will still be sufficient supply in the global market. Given that Mozambique’s production of rice and wheat is negligible, the current weather induced devastation will not lead to meaningful changes in the imports of these commodities.

It is, however, worth noting that a large proportion of wheat and rice imports are shipped in through the port of Beira, which is in an area said to have borne the brunt of the cyclone’s destructive force. Damage to the port’s infrastructure and storage facilities could obstruct or delay imports, with implications for the country’s supply.

The case of maize is somewhat different. In a normal season Mozambique produces more than 70% of its annual maize requirements, but this is now likely to change. Although it has been difficult to ascertain the impact of the floods on maize production thus far, anecdotal evidence points to severe damage in the southern and coastal parts of the country. Hence, we suspect imports could increase from the average volume of about 100 000 tons per calendar year in normal seasons. In the more recent past, key suppliers of maize to Mozambique have been South Africa, Mexico and Zambia.

The 2018/19 production season has not been a favourable for South Africa or Zambia, with both countries set to record double digit figure declines in production, compared to the previous season. This does not necessarily mean there will be no maize for export, but it does mean that prices will be higher, which will ultimately lead to increased food insecurity in Mozambique. – Wandile Sihlobo, Agbiz

Wandile Sihlobo, head of economic and agribusiness intelligence at Agbiz, shares highlights in his update on agricultural commodity markets. Click here for the full report on agri markets for the major commodities.

Find previous reports here.

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