USDA left its SA maize production estimate unchanged

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USDA left its SA maize production estimate unchanged

  • Last night, the United States Department of Agriculture (USDA) left its estimate for South Africa’s 2017/18 maize production unchanged from the last month at 13.5 million tonnes. While above market expectations, this is lower than the previous season’s record harvest of 17.6 million tonnes due to a decline in area planted and expectations of average yields in some areas.
  • Moreover, this is in line with the National Crop estimate Committee’s estimate for overall production (commercial and non-commercial). The non-commercial production, which is subsistence farming accounts for a 6 percent share in the estimated harvest of 13.5 million tonnes.
  • The key message from these numbers is that South Africa’s maize market will be well supplied in the 2018/19 marketing year. The total maize supplies could reach 16.3 million tonnes, well above the local demand of 10.8 million tonnes, according to data from the national Supply and Demand Estimates Committee. The supplies figure includes an opening stock and expected production.
  • This essentially means that South Africa’s 2018/19 marketing year maize exports could, at least, amount to 2.4 million tonnes, down by 4 percent from the volume exported in 2017/18. Most importantly, this suggests that the SAFEX maize prices could remain at relatively lower levels for some time, all else being equal.
  • With that said, last week’s maize exports were quite disappointing. The country exported 27 103 tonnes of maize in the week, down by 73% volume exported in the week of 01 June 2018. About 75 percent of the exports were yellow maize, with 25 percent being yellow maize.

 

Click HERE to read the full report by Wandile Sihlobo