The Agricultural Business Chamber of South Africa (Agbiz) yesterday said the Crop Estimates Committee (CEC) has lifted the 2023/24 summer grains and oilseed harvest by 0.6% from last month to 16 million tons.
Agbiz chief economist Wandile Sihlobo said a closer look at the data showed that white and yellow maize harvest could be 6.3 million tons and 7.1 million tons, a 0.1% and 1.3% month-on-month increase, respectively.
Sihlobo said these revisions placed the total maize production estimate at 13.4 million tons, up by 0.7% month-on-month.
When viewed annually, Sihlobo said white maize harvest was down 26%, with yellow maize down 10% from the 2022/23 season.
“The disparity in the crop decline is due to regions where each crop variety is planted, with white maize predominantly in the western areas of South Africa, while yellow maize is in the east,” he said.
“Moreover, yellow maize is typically planted a month earlier than white maize. Rainfall impacts these regions and time frames differently, ultimately affecting the expected harvest sizes. The expected harvest of 13.4 million tons is down 18% from the 2022/23 season.”
Sihlobo said they were optimistic that this harvest may materialise and meet South Africa’s annual maize consumption of roughly 12 million tons, leaving the country with roughly 1.4 million tons for exports.
“About 840 000 tons will likely be white maize, with 600 000 tons likely to be yellow maize, according to data from the South African Grains and Oilseed Supply and Demand Estimates Committee. Still, the estimated exports of 1.4 million tons are down notably from 3.4 million tons in the previous season.”
However, Agbiz said maize prices would likely remain elevated for some time because of potentially tighter supplies later in the season and into the first quarter of next year.
“Admittedly, in recent weeks, white and yellow maize prices have moderated from the levels we saw last month because of the relatively stronger domestic currency and the harvest pressure, amongst other factors,” it said.
“Still, white maize prices are over 30% higher than the levels we saw a year ago. The white maize spot price closed at R5 185 per ton on June 27, 2024. Meanwhile, the yellow maize prices currently are down roughly 4% from a year ago. The yellow maize spot price was at R3 825 per ton.”
The 2023/24 soybean harvest was unchanged from last month to 1.7 million tons resulting from lower yields in various regions of South Africa.
Sihlobo said they now believed South Africa may not play a robust position in soybean exports like the previous season.
“If anything, soybean oilcake imports this new season are now a possibility. Moreover, the sunflower seed harvest estimate was unchanged from last month at 649 250 tons, down 10% year-on-year,” Sihlobo said.
“The area plantings are moderately down from the previous year, which means the primary driver of the annual decline in the harvest is the expected poor yields, especially as most of the sunflower seed is planted in the western regions.”
The 2023/24 groundnut harvest estimate was 54 440 tons (up 3% y/y), sorghum was at 95 830 tons (up 2%), and dry beans were at 52 190 tons (up 4%).
According to Sihlobo, this data illustrated the scale of damage caused by the midsummer drought to the South African summer grains and oilseed harvest.
“Still, from a consumer perspective, South Africa is not in a crisis regarding supplies of grains and oilseed,” he said.
“With that said, there are upside risks to white maize prices, especially considering the potentially ample demand from the southern Africa region later in the year and into the first quarter of 2025 when their domestic supplies are depleted.”
BUSINESS REPORT