Last night (12 June 2018), the United States Department of Agriculture (USDA) left its estimate for South Africa’s 2017/2018 maize production unchanged from the last month at 13.5 million tons. While above market expectations, this is lower than the previous season’s record harvest of 17.6 million tons due to a decline in area planted and expectations of average yields in some areas.
This is in line with the national Crop Estimates Committee’s estimate for overall production (commercial and non-commercial). The non-commercial production, which is subsistence farming, accounts for a 6% share in the estimated harvest of 13.5 million tons.
The key message from these numbers is that South Africa’s maize market will be well supplied in the 2018/2019 marketing year. The total maize supplies could reach 16.3 million tons, well above the local demand of 10.8 million tons, 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 2018/2019 marketing year maize exports could, at least, amount to 2.4 million tons, down by 4% from the volume exported in 2017/2018. Most importantly, this suggests that the SAFEX maize prices could remain at relatively lower levels for some time, all else being equal.
Last week’s (ending 8 June 2018) maize exports were quite disappointing. The country exported 27 103 tons of maize in the week, down by 73% volume exported in the week of 01 June 2018. About 75% of the exports were yellow maize, with 25% being yellow maize. – 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.