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Brief Overview of the Current South African Grain Supplies
Wandile Sihlobo, Agricultural Economist
03 May 2016
USDA, Pretoria, RSA
1
Source: SAWS, Absa Agribusiness and Agbiz Research
RSA Rainfall at the Lowest Levels Since Early 1900’s
2
-
100
200
300
400
500
600
700
800
900
1 0001
79
6
18
05
18
14
18
23
18
32
18
41
18
50
18
59
18
68
18
77
18
86
18
95
19
04
19
13
19
22
19
31
19
40
19
49
19
58
19
67
19
76
19
85
19
94
20
03
20
12
20
21
20
30
mm
Rain Avg
Background on the Grain Supply Industry
•RSA growers produce 42% of all maize in SADC
•SADC is a net importer of RSA maize
•RSA summer grain production yield decreases 27%y/y
in 2015 (maize -30%y/y).
•RSA 2016 maize production could decrease further by
29%y/y.
3
Source: BFAP, Grain SA and Agbiz Research
Maize Production : Negatively Affected Across the Region
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
SA ZAM MOZ TAN MAL ZIM KEN
Mill
ion
to
ns
2014 2015 EST 2016
4
Source: Grain SA and Agbiz Research
RSA Total Maize Production Lowest since 2006/07…
0.0
3000.0
6000.0
9000.0
12000.0
15000.0
19
91
/92
19
92
/93
19
93
/94
19
94
/95
19
95
/96
19
96
/97
19
97
/98
19
98
/99
19
99
/00
20
00
/01
20
01
/02
20
02
/03
20
03
/04
20
04
/05
20
05
/06
20
06
/07
20
07
/08
20
08
/09
20
09
/10
20
10
/11
20
11
/12
20
12
/13
20
13
/14
20
14
/15
20
15
/16
*
‘00
0 T
on
s
5
Source: Grain SA and Agbiz Research
RSA Production: Majority of Summer Crops have been
Negatively Affected
6
0
100
200
300
400
500
600
Ind
ex 2
00
4/0
5 =
10
0
Groundnuts (-48% y/y) Maize (-29% y/y)
Soybean (-35% y/y) Sunflowerseed (+10% y/y)
Source: Grain SA and Agbiz Research
RSA Production: Majority of Summer Crops have been
Negatively Affected
7
0
100
200
300
400
500
600
Ind
ex 2
00
4/0
5 =
10
0
Groundnuts (-48% y/y) Maize (-29% y/y)
Soybean (-35% y/y) Sunflowerseed (+10% y/y)
Source: Grain SA and Agbiz Research
RSA Production: Majority of Summer Crops have been
Negatively Affected
8
0
100
200
300
400
500
600
Ind
ex 2
00
4/0
5 =
10
0
Groundnuts (-48% y/y) Maize (-29% y/y)
Soybean (-35% y/y) Sunflowerseed (+10% y/y)
Source: Grain SA and Agbiz Research
Continuous Growth in Demand of RSA Maize for Feed
Consumption
1 000
2 000
3 000
4 000
5 000
6 000
'00
0 T
on
s
Human Consumption Feed Consumption
9
Source: Grain SA and Agbiz Research
RSA Maize Commercial Demand Remains Strong
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
2 000
4 000
6 000
8 000
10 000
12 000
14 000
16 000
2011/12 2012/13 2013/14 2014/15 2015/16* 2016/17**
‘00
0 T
on
s
‘00
0 T
on
s
Imports Whole maize exports
Carry-out stocks Production
Total commercial demand10
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
% im
po
rts
of
ann
ual
mai
ze c
on
sum
pti
on
SADC: Expected % Imports of Annual Domestic
Consumption
Source: USDA, ITC and Agbiz Research 11
100
200
300
400
500
600
700
800
900
1 000
2012/13 2013/14 2014/15 2015/16
Millio
n t
on
s
Production Consumption Ending Stocks
Source: IGC and Agbiz Research
Global Maize Supply Remains at High Levels
12
13
KEY COMMODITY PRICE MOVEMENTS
Source: JSE, IGC, Grain SA and Agbiz Research
Maize and Rice Prices Peaked in January 2016…
0
50
100
150
200
250
300
350
0
1000
2000
3000
4000
5000
6000
7000
US$
/T
ZAR
/T
Rice (Thailand) Yellow Maize White Maize US Maize
14
White Maize Price is well Above the Import Parity Price
Source: IGC , Grain SA and Agbiz Research 15
1 200
1 700
2 200
2 700
3 200
3 700
4 200
4 700
5 200
15-F
eb
-13
22-A
pr-
13
25-J
un
-13
28-A
ug
-13
31-O
ct-
13
7-J
an
-14
12-M
ar-
14
15-M
ay-1
4
18
-Ju
l-14
22-S
ep
-14
25-N
ov-1
4
29-J
an
-15
7-A
pr-
15
10-J
un
-15
13-A
ug
-15
16-O
ct-
15
22-D
ec-1
5
24-F
eb
-16
28-A
pr-
16
R/t
on
USA Import Parity USA Export Parity Safex WM
Yellow Maize Price is at Import Parity Price Level
Source: IGC , Grain SA and Agbiz Research 16
1 200
1 600
2 000
2 400
2 800
3 200
3 600
4 000
4 400
1-O
ct-
12
30-N
ov-1
2
5-F
eb
-13
8-A
pr-
13
7-J
un
-13
8-A
ug
-13
9-O
ct-
13
10-D
ec-1
3
12-F
eb
-14
15-A
pr-
14
16-J
un
-14
15
-Au
g-1
4
16-O
ct-
14
18-D
ec-1
4
18-F
eb
-15
23-A
pr-
15
24-J
un
-15
25
-Au
g-1
5
26-O
ct-
15
28-D
ec-1
5
26-F
eb
-16
28-A
pr-
16
R/t
on
ARG Import Parity USA Import parity USA Export Parity
Safex YM
RSA Total Grain and Oilseed Import Estimates for 2016 –
April 2017 is 7.24 million tons…
Source: Grain SA and Agbiz Research
Maize, 3.80
Wheat, 2.00
Rice, 0.90
Sorghum, 0.06
Barley, 0.06 Soybean, 0.30
Sunflowerseed, 0.10
Peanuts, 0.02
Units: million tons
17
SOUTH AFRICAN WHEAT PRODUCTION
18
Source: Grain SA and Agbiz Research
RSA Wheat Production is under Pressure….
1000
1500
2000
2500
3000
3500
1990/91 1993/94 1996/97 1999/00 2002/03 2005/06 2008/09 2011/12 2014/15
00
0 t
on
NOK produksie skatting/CEC crop estimate ('000ton)
Totaal RSA verbruik / Total RSA consumption
Linear (NOK produksie skatting/CEC crop estimate ('000ton))
Linear ( Totaal RSA verbruik / Total RSA consumption)
19
Source: Grain SA and Agbiz Research
RSA is Increasingly Importing more Wheat….
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
0
200
400
600
800
1 000
1 200
1 400
1 600
1 800
2 000
1990/91 1994/95 1998/99 2002/03 2006/07 2010/11 2014/15
%
00
0 t
on
Invoere / Imports % invoere t.o.v RSA verbruik/ % imported of RSA consumption
20
Source: IGC and Agbiz Research
Global Wheat Supply Remains at High Levels
21
150
250
350
450
550
650
750
2012/13 2013/14 2014/15 2015/16
Mil
lio
n t
on
s
Production Consumption Ending Stocks
Wheat Prices Trade Along Import Parity Prices…
Source: IGC, Grain SA and Agbiz Research 22
2 000
2 400
2 800
3 200
3 600
4 000
4 400
4 800
5 200
5 600
1-O
ct-
12
26-N
ov-1
2
24-J
an
-13
21-M
ar-
13
16-M
ay-1
3
11-J
ul-
13
5-S
ep
-13
31-O
ct-
13
27-D
ec-1
3
24-F
eb
-14
21-A
pr-
14
16
-Ju
n-1
4
11-A
ug
-14
6-O
ct-
14
1-D
ec-1
4
27-J
an
-15
26-M
ar-
15
21-M
ay-1
5
16-J
ul-
15
10-S
ep
-15
5-N
ov
-15
4-J
an
-16
29-F
eb
-16
25-A
pr-
16
R/t
on
USA Import Parity Safex USA Export Parity
• WMAZ Spot price have increased by +80% y-o-y (April 16)
• YMAZ Spot price have increased by +30% y-o-y (April16)
• CPI bread & cereal increased by 13.3% y-o-y (March 16)
• PPI cereals & crops increased by 50% y-o-y (March16)
• Maize meal prices increased by 47% y-o-y (March 16)
• Rice prices increased by 5% y-o-y (March 16)
• Beef prices increased by 9% y-o-y (March 16)
• Milk prices increased by 3% y-oy (March16)
• Egg prices increased by 12% y-o-y (March 16)
• Sunflower oil prices increased by 33% y-o-y (March16)
23
2016 will see the toughest consumer environment
FAO Food Price Index
Source: FAO
Thank you for your attention
Contact details:
Wandile Sihlobo
Agbiz Agricultural Economics Research
Email: [email protected]
www.agbiz.co.za
25
