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 market overview for September 2020.
The price of yellow maize continued its upward trend during September. These higher prices were caused by high international prices and a weaker rand. The market closed at R3 255/ton.
The rand strengthened during September but remained relatively weak. At the end of the month, the rand traded at R16,61 and R19,50 against the dollar and euro, respectively.
The consumer price index and producer price index increased by 3,1% year-on-year (y/y) and 2,5% y/y during August. The prime lending rate remained steady at 7% during September. Economic growth during the second quarter of 2020, as represented by the gross domestic product (GDP), decreased by 17,1% y/y.
Red meat market
During September, the price of A2 lamb and C2 sheep carcasses increased slightly. However, the price of B2 carcasses decreased. The price of A-, B- and C-grade beef carcasses increased significantly.
The last available beef carcass prices were R46,94/kg for A2, R43,15/kg for B2 and R40,62/kg for C2. The last available prices of A2, B2 and C2 lamb and sheep carcasses were R88,51/kg, R67,92/kg and R66,64/kg, respectively.
The last available prices for weaner lambs and calves were R45,28/kg and R36,37/kg, respectively. Hide and Merino skin prices moved sideways during September. The price of Dorper skins took a hit at the beginning of the month, but found its footing again towards the beginning of October.
Wool and mohair market
The natural fibre market fared relatively well during September, with the indicator prices of wool and mohair increasing significantly. The wool indicator price strengthened by 6,2% during the last auction in September compared to the previous auction. However, it traded 22,2% lower than a year ago. The mohair indicator price increased by 5,9% during the last auction in September and traded 6,5% higher than a year ago.
The consumer price of milk, eggs and cheese increased slightly during August. The producer price of milk products increased significantly, while the price of milk and eggs moved sideways.