The weather will be the main focus in South Africa’s (SA) agricultural sector for both summer and winter crops, and to a lesser extent, horticulture in the near term. The summer crop growing areas are approaching a harvest period, with early-planted soya bean and sunflower seed already being harvested across the country.

In contrast, maize and sorghum harvesting has only started in a few areas, such as the early-planted areas in Mpumalanga. The harvesting process requires dry weather conditions, and the same is needed for crops that are already maturing across the country.

On 31 March 2021, the SA Weather Service confirmed that SA is still in a La Niña state. Its multi-model rainfall forecast indicates mostly above-normal rainfall during late autumn (April, May, June) and early winter (May, June, July).

Nevertheless, it is unclear how much rain will materialise. We hope that it will mostly be light showers with minimal impact on crops. Over the past few weeks, the weather conditions have generally been favourable across SA, albeit with frequent light rain, which so far has had minimal impact on crops.

As we’ve noted before, the Crop Estimates Committee forecasts SA’s 2020/21 summer grain and oilseeds production at 18,7 million tons, up by 6% from the 2019/20 season. The upward adjustments were on maize, soya bean, sorghum and groundnut, whereas sunflower seed and dry bean production was lower than the 2019/20 production season.

Viewed from this data, SA is looking at its second-largest harvest on record. If weather conditions remain reasonably dry in the next few months, the crop quality could also be good, which will potentially bode well for farmers’ income.

Winter crops and horticulture forecast

In winter crops – wheat, barley, canola and oats – the planting period will start towards the end of this month. Contrary to the summer crop growing regions, the winter crop regions will require increased moisture to support crops’ germination and growth process. The weather forecast remains uncertain, for now. The SA Weather Service recently noted that “a mixed forecast is indicated for the far south-western parts of the country; thus, the expected rainfall conditions for this area are uncertain at this stage”.

Aside from the Western Cape, which typically accounts for two-thirds of winter wheat plantings and most barley and oats, as well as all canola plantings, soil moisture has improved for various regions of the country following higher summer rainfall. This should be beneficial for plantings later this month, and the dam levels are also in reasonably good shape in some provinces, which should be helpful for crops in the irrigation areas. The Western Cape conditions will mainly depend on how weather conditions develop from the current uncertain stage in the coming weeks, influencing the planting decisions in terms of the size of area plantings, and subsequently, crop conditions.

In terms of horticulture, the recent higher rainfall across the country has generally been favourable for fruit and vegetables. The significant fruit that will be harvested in the coming weeks are citrus, and the forecasts point to a large harvest. The Citrus Growers’ Association recently noted that the “SA citrus industry will likely break all previous export season records with an estimated 158,7 million cartons in 2021. If the estimate is reached, it will represent a third consecutive season of record export volumes, with 130 million cartons exported in 2019, followed by 146 million cartons in 2020.”

SA’s rice imports to increase marginally in 2021

Rice is one of the main staple foods which SA imports, as the country does not have a conducive climate for its production. The International Grains Council forecasts SA’s 2021 rice imports at 1,1 million tons, a 5% increase from the previous year. The imports are usually evenly spread throughout the year, with a slight peak in volumes in the last quarter of each year.

Approximately 70% of SA’s rice is usually imported from Thailand, with other notable suppliers being Thailand, India, Pakistan, China and Vietnam. All these countries currently expect a reasonably good harvest, which supports the availability of supplies for exports. Worth noting is that, on average, approximately 10% of the imported rice each year is re-exported to the neighbouring countries, namely Swaziland, Botswana, Zimbabwe, Lesotho, Namibia and Zambia (Exhibit 1).

(Source: International Grains Council, Trade Map and Agbiz Research)

From a supply perspective, the global rice market is in relatively good shape. According to data from the International Grains Council, the 2020/21 global rice production is projected at a record 504 million tons, which is up 1% from the previous season. The vital contributing countries to the expected increase are India, Vietnam, Pakistan, Bangladesh, Thailand, Indonesia and the Philippines. The benefit of stable global rice production is reflected in prices which have flattened in the recent weeks, following an upsurge at the start of the year, which was partly underpinned by the growing demand in China (Exhibit 2). The stable prices are beneficial to rice-importing countries such as SA. The only risk for local importers in the near term is the weaker domestic currency.

(Source: International Grains Council)

Data to be released this week

On Thursday, the SA Grain Information Service (SAGIS) will release the weekly grain producer deliveries datafor 2 April 2021. This data covers both summer and winter crops, although the focus will shift to mainly summer crops in the coming weeks as the harvest process gains momentum. For now, however, we still monitor developments in all grains.

On 26 March, 5 037 tons of winter wheat were delivered by farmers to commercial silos. This placed the 2020/21 wheat producer deliveries at 1,99 million tons, which equates to 94% of the expected harvest of 2,11 million tons. In terms of summer crops, the harvesting process is still at the preliminary stages, as we previously stated.

Nevertheless, we already see momentum in the 2021/22 soya bean and sunflower seed producer deliveries from the early-planted areas. On 26 March, approximately 30 033 tons of soya beans were delivered to commercial silos. This placed the deliveries for the first four weeks of the new marketing year at 72 123 tons out of the expected harvest of 1,73 million tons.

Similarly, approximately 22 219 tons of sunflower seed have already been delivered in the 2021/22 season, out of the anticipated crop of 696 290 tons.

On Friday, SAGIS will release the weekly grain trade data for the week of 2 April 2021. In the previous week of 26 March, SA’s 2020/21 total maize exports were at 2,34 million tons, which equates to 87% of the seasonal export forecast of 2,69 million tons. In terms of wheat, SA is a net importer. On 26 March, imports amounted to 705 843 tons, which equates to 45% of the seasonal import forecast of 1,58 million tons.

Globally, the notable data release will be the United States (US) weekly export sales data released by the US Department of Agriculture (USDA) on Thursday. Here, we will continue to monitor China’s buying activity of US maize and soya beans. On Friday, the USDA will release an update of the World Agricultural Supply and Demand Estimates report for March 2021. – Wandile Sihlobo, chief economist, Agbiz

Read previous reports here.