The weather was a key focus this week (ending 12 October 2018), not only because the 2018/2019 summer grain planting window recently opened in the eastern and central parts of South Africa, but also because of the mixed weather prospects for the season.
The local weather agency forecast a likelihood of above-normal rainfall between November 2018 and January 2019, with dry conditions later in summer. The Australian Bureau of Meteorology placed the chances of an El Niño event developing this year at 70%, up from the previous estimate of 55%.
This means that even if the summer crops have a good start of the season, the pollination stages could fall in the dry spell which might negatively affect the yields. At the moment, it is unclear how farmers will react to this. We will have a better view when the Crop Estimates Committee releases the plantings intentions data on 25 October 2018.
Apart from the grain and oilseed market, the SAFEX beef carcass market experienced a quiet week with prices unchanged from levels seen last week (ending 5 October 2018). In terms of supply, South African farmers slaughtered 211 951 head of cattle in August 2018, down by 11% from August 2017 due to the herd rebuilding process after a reduction during the 2015/2016 drought. –Wandile Sihlobo
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.