Frikkie Maré, agricultural economist at the University of the Free State (UFS) gives his monthly market overview of agricultural commodity markets.
The price of yellow maize was revived during March only to drop again later in the month. The decline can be attributed to larger than expected yield and the stronger Rand. The price of yellow maize closed at R1 961/ton.
The Rand gained strength further in March against the major currencies. By the end of the month the Rand traded at R11,84 against the Dollar and R14,57 against the Euro. Both the consumer price inflation (CPI) and the producer price inflation (PPI) increased at a slower rate in February at 4% and 4.2% respectively. The economic growth of the fourth quarter of 2017, as suggested by GDP, increased 1.5% on a year on year basis. Agriculture once again, as in the third quarter, contributed positively to economic growth.
Red meat market
The prices of B and C grade beef declined during March while A grade traded sideways. The last available prices for March were R46.83/kg for A2, R43.22/kg for B2 and R40.87/kg for C2. Mutton prices declined for all grades. The last available prices for A2, B2 and C2 sheep carcasses were R69.73/kg, R60.76/kg and R54.79/kg respectively. Prices for weaner calves and weaner lambs decreased to close at R34.00/kg and R38.50/kg. Prices for hides and Merino skins also declined while Dorper skins traded sideways.
Wool and mohair market
The indicator price for clean wool declined during March. The price for wool was 2.5% lower at the last auction in March than the previous one, but 5.6% higher than the previous year. The indicator price for mohair increased sharply in March and traded 1.4% higher than at the previous auction. The price is 27.8% higher than last year.
The producer price index for milk and eggs declined in February, while the index price for dairy traded sideways. The consumer price index of milk, eggs and cheese increased slightly during the same period.