Dr Frikkie Maré, academic head of the Department of Agricultural Economics at the University of the Free State (UFS), provides a monthly agri market overview of the previous month’s agricultural markets. This is the overview for October 2019.
The price of yellow maize strengthened during the first few days of October before showing a decline. The market closed at R2 702/ton.
The rand strengthened at the beginning of October, before weakening towards the end of the month. The currency traded at R14,95 and R16,70, respectively, against the dollar and euro at the end of the month.
During October, both the consumer price index (CPI) and the producer price index (PPI) decreased to 4,1% year-on-year. The prime rate remained the same at 10%. The economic growth for the second quarter of 2019, as prescribed by the GDP, increased to 0,9% year-on-year. The economy also grew by 3,1% quarter-on-quarter.
Red meat market
The market for all three grades of beef carcasses declined in October. Mutton prices were precarious throughout the month, and B-grade showed a heavy decline.
The last available prices for beef in October were R45,25/kg for A2, R38,94/kg for B2 and R36,46/kg for C2. The last available prices for A2, B2 and C2 lamb and sheep carcasses were R66,46/kg, R50,93/kg and R47,95/kg, respectively.
In the case of weaner animals, the price of lamb fell substantially while the price of beef strengthened. The last available prices were R30,02/kg for calves and R31,02/kg for lambs. The prices of hides and skins also showed further sideways movement.
Wool and mohair market
The wool market picked up sharply during October; however, the mohair market declined during the same period. The clean wool indicator increased by 6,8% at the last auction of October, but is still trading 23% lower than last year. The mohair indicator weakened by 2,5% compared to the previous auction. It also traded 33,7% lower than last year.
The PPI of milk and eggs showed further decline in October, while the index of milk products increased. The CPI of milk, eggs and cheese decreased during the same period.
Click here to read September’s market overview. – Dr Frikkie Maré, University of the Free State