Record-high volumes loom large for South Africa’s grains and oilseeds industry. According to the National Agricultural Marketing Council (NAMC) supply projections for the 2020-2021 marketing season is likely to surpass market demands, placing Mzansi in a favourable self-sufficient status.
Currently the total supply projections for maize sits at 15 777 580 tonnes, while domestic demand (plus exports) is expected to reach 11 440 500 tonnes this season. Other commodities such as sorghum, wheat, sunflower seeds and soyabeans are also tabling positive numbers, with surplus amounts reaching as high as 9 000 tonnes.
Speaking to Food For Mzansi, Luan van der Walt, agricultural economist at Grain SA, says South Africa has recorded record-high crop volumes this season – making it a grain self-sufficient country.
“There was a big increase in the demand this season, specifically for maize. It looks like we are going to have a new record-demand for human consumption and this of course, is very positive for South African agriculture,” he states.
Last season, the demand for maize reached just over 11.2 million tonnes. This time around it is expected to be around 11.5 million tonnes.
Record-high numbers for third consecutive year
According to Van der Walt this is the highest local demand figure since 1997.
“Two years ago, we too had a record demand, again in 2019 and for a third consecutive year it appears that we will have another record-consumption in the maize market this season,” says Van der Walt.
The high demand appears to have been brought on by both the local and international market. South Korea, Vietnam and Japan is reported to be the top overseas markets for Mzansi’s maize this season.
Nearly 300 000 tonnes of processed products and 2 150 000 tonnes of whole maize have been estimated for exports for the 2020/21 marketing season.
Furthermore, locally there has also been an increase in the milling numbers of maize milled for human consumption. A similar scenario has been painted for animal feed.
“This is of course is good news for SA agriculture as a whole,” Van der Walt says. “We saw the impact it had on the economic growth figures this season, so it was quite favourable.”
Agriculture was the only one of nine sectors in the economy to show GDP growth in the second quarter. The sector expanded by almost 28% in the first quarter compared to the same period in 2019 and 15.1% in the second quarter.
Focus on current planting season
According to Agbiz chief economist Wandile Sihlobo the increase was the second largest grains harvest in the history of South Africa.
“The increase in output was on the back of favourable weather conditions, which ensured that farmers receive higher yields, coupled with a general increase in area plantings.”
The focus now, however, remains on the crop which is currently being planted by farmers for the 2021-2022 marketing year that starts on 1 May 2021.
Sihlobo believes the next four months will warrant constant monitoring because it will be a crucial period for all summer crops, from planting to pollination.
“From a macroeconomic standpoint, we believe that agriculture will again show positive growth in 2021, although at a much lower rate than the 10% y/y expansion we currently expect in agriculture’s gross value-added in 2020,” Sihlobo states.
Great news for other commodities
Meanwhile the total supply of wheat is projected at 4 008 812 tonnes for the 2019/20 marketing season, while demand estimates stand at 3 569 600 tonnes.
Sunflower seed is projected at 926 735 tonnes and demand for the crop is expected to reach 834 350 tonnes. Also, in a good standing are soyabeans, which is projected to tally to 1 519 305 tonnes, while the demand hovers around 1 398 200-tonne mark.
Total supply projections for sorghum currently stands at 219 508 tonnes. Demand for the crops has been projected to be 176 615 tonnes.