Wandile Sishlobo, Agbiz.

The next eight days should remain cool and dry in the soya bean growing areas, which should be supportive of the harvest process. This is at initial stages in parts of Mpumalanga province, and it could soon commence in other provinces as a large part of the crop has already matured.

The soya bean crop is in good condition throughout the country and this is demonstrated in the CEC’s decision to revise South Africa’s 2017/2018 soya bean production estimate up by 3% from the previous season to 1.4 million tons (see Chart below). This is underpinned by expected higher yields, as well as an increase in area planted. The key soya bean-growing provinces are the Free State, Mpumalanga and KwaZulu-Natal, making up a combined share of 87%. The other notable soya bean-producing province is Gauteng and North West with a combined share of 8%.

This expected large crop implies that South Africa’s soya bean market will be well-supplied in the 2018/2019 marketing year. The seasonal imports could decline by 27% year-on-year to 20 000 tons. This is a notable improvement following imports of 271 098 tons in the 2016/2017 marketing year. We estimate that in 2018, soya bean oilcake imports could decline by 17% from last year to 458 992 tons. This too is a remarkable improvement from imports of close to a million tons in 2010.

Aside from production aspects, the most recent data from SAGIS shows that South Africa’s soya bean stocks were at 261 613 tons in March 2018, which is almost double the volume seen in the corresponding period last year. Also worth noting is that soya bean consumption (crushed oil and cake) was at 74 282 tons in March 2018, down by 20% from the corresponding period last year.

Using an estimate of 2.2 million tons of South Africa’s soya bean crushing capacity, which equates to 183 333 tons per month, the country utilised 41% of its monthly soya bean processing capacity in March 2018, down by 2 percentage points from the previous month and 10 percentage points from the same period last year.

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.

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