Zimbabwe is likely to experience a shortage of maize supplies in the 2019/20 marketing year due to an expected poor harvest.
Zambia and Malawi’s maize harvest could fall double-digit from the 2017/18 production season, but the countries could still be self-sufficient in the 2019/20 marketing year (corresponds with 2018/19 production season), supported by fairly large stocks from the previous year.
Back in home soil, the western maize production areas of South Africa are now critically dry once again because of the hot and dry weather and relatively limited soil moisture leading into the week of 17 January 2019. The impact of this was reflected in maize prices which rallied to levels over R3 000 per tonne, particularly white maize which is planted in the western regions.
An important date to keep an eye on is 29 January 2019 when the national Crop Estimate Committee releases the preliminary planting data for South Africa’s summer grains and oilseeds.
The weather will continue to play a key role in the South African agricultural markets in the next three months. Thereafter, the focus will shift to winter crop producing areas. The near-term precipitation prospects are constructive (see page 6).
At the end of the week of 17 January 2019, SAFEX wheat prices were up by 17% from levels seen in the corresponding period last year, trading around R4 379 per tonne. This was driven by high international wheat prices and the relatively weaker domestic currency.
Overall, the tough production conditions in the grains and oilseeds subsectors will most likely add upward pressure on consumer prices, but we do not expect a notable uptick in headline food price inflation, as lower meat prices will somewhat overshadow the potential upswings.
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Sourced: Agbiz, Agribusiness Research