Dr Frikkie Maré, academic head of the Department of Agricultural Economics at the University of the Free State (UFS), provides a monthly market overview of the previous month’s agricultural markets. This is the overview for June 2020.
The price of yellow maize increased sharply during the first three weeks of June and then decreased again during the last week. The market closed at R2 600/ton.
At the end of the month, the rand traded at R17,37 and R19,48 against the dollar and euro, respectively. Due to the COVID-19 pandemic, Statistics South Africa (Stats SA) is behind on the release of most of their data and April’s consumer price inflation (CPI) and producer price inflation (PPI) data has therefore only recently been released.
During April the CPI and PPI increased year-on-year with 3 and 1,2%, respectively. The prime lending rate remained steady at 7,25%. The economic growth for the first quarter of 2020, as represented by the gross domestic product (GDP), decreased once again with -0,1% on a year-on-year basis. Quarter-on-quarter the economy shrunk by 2%.
Red meat market
In terms of the market movement of beef carcasses, A grade meat prices moved sideways and prices for B and C grade carcasses increased dramatically. The last available prices for A2, B2 and C2 beef carcasses were R43,78/kg, R41,07/kg and R38,74/kg, respectively.
The last available prices for A2, B2 and C2 lamb and sheep carcasses were R82,77/kg, R59,37/kg and R62,34/kg, respectively. Prices for both weaner calves and lambs decreased in June. The last available prices were R28,63/kg for calves and R39,85/kg for lambs. The price of hides moved sideways and although the price of Merino and Dorper skins were up and down throughout the month, Merino skin prices increased slightly.
Wool and mohair market
Prices of both wool and mohair decreased during June. The indicator price for wool strengthened by 0,1% during the last auction in June compared to the previous auction, but still traded 42% lower than a year ago. The indicator price for mohair decreased by 1,8% during the last auction in June and traded 25,1% lower than a year ago.
The consumer price of milk, eggs and cheese increased during April. The producer price of milk, eggs, as well as dairy products also increased.
Click here to read the May 2020 market overview. – Dr Frikkie Maré, University of the Free State