Although canola and oats farmers have started planting in parts of the Western Cape and wheat planting is set to commence soon, the germination process could be slightly delayed. The near-term weather forecast indicates continuous dry conditions in the Western Cape during the next two weeks.

The weather forecast changed overnight, currently showing clear skies across most parts of the province,  and therefore minimising the possibility of light showers in the western parts of the province. Moreover, this means the provincial dam levels could remain at fairly lower levels for some time. In the week of 23 April 2018, the dams averaged 16% , down by a percentage point from the previous week, and 6 percentage points from the corresponding period last year.

Above all, the upcoming production season promises to be better than the last. While rainfall could be delayed, there is a bit of optimism following the local Weather Service view that parts of the south-western Cape regions of the country could receive above-normal rainfall between the end of this month (April) and June 2018.

As set out yesterday (24 April 2018), an important data point to keep an eye on today (25 April 2018) is the intentions-to-plant data which is due for release in the afternoon. Bloomberg analysts’ forecasts put South Africa’s 2018/2019 winter wheat planting at 492 500 hectares, which is slightly above the previous season’s plantings of 492 500 hectares (see Chart below). Another key data is the SAGIS monthly figures which will include wheat stock levels. Last month, South Africa’s wheat stocks were recorded at 1.5 million tons, which is 7% lower than the volumes recorded in February 2017.

Chart: South Africa’s wheat area plantings
Source: SAGIS, CEC, Agbiz Research
*Bloomberg’s analyst estimate

From a trade front, there were no imports last week, and the last imports were in the week ending 16 March 2018, recorded at 25 135 tons. This placed the 2017/2018 marketing year’s wheat imports at 1.2 million tons, which equates to 63% of the seasonal import forecast of 1.9 million tons. – 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.

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