The Agricultural Business Chamber (Agbiz) has warned that the new 2024/25 marketing year was likely to see significantly lower export volumes for maize, unlike the previous years of high export volumes.
This comes as exports for the 2023/24 marketing year declined by 6% from last year to 3.4 million tons, according to the South African Grains Information Services.
April marked the end of South Africa's 2023/24 marketing year for maize.
This marketing year corresponds with the 2022/23 production season, as the crop harvested mid-year in 2023 was marketed from then through to the end of April 2024.
According to data from the Crop Estimates Committee (CEC), the 2022/23 production season was characterised by an excellent harvest of 16.4 million tons
Agbiz chief economist Wandile Sihlobo yesterday said the tight supply could cause price volatility in the coming months, but this should not be a cause for deviations in the current agricultural policy.
Sihlobo said while South Africa expected a significantly lower harvest this year, the country could remain a net exporter of maize.
“With an annual maize consumption of approximately 12.0 million tons and a harvest of 13.3 million tons, South Africa will have over a million tons of maize for exports,” Sihlobo said.
“We also believe there are decent carryover stocks from the past season, which will help increase the maize supplies for the new marketing year of 2024/25.
“Still, there remains heightened uncertainty about the actual size of the maize crop this year. The forecast of 13.3 million tons is the third estimate by the CEC. In the coming months, the committee could still adjust the figures depending on their observations of the yields in the various regions of South Africa.”
Moreover, the agribusinesses organisation said it remained unclear what the impact of the rains in early April, after two months of damaging dryness, meant for the crop size.
This was as many observers, ourselves included, were surprised when the CEC mildly lifted their crop forecast on April 25.
The market expectation was a possible downward revision of the crop.
Sihlobo said another challenge that lingered as the region started the 2024/25 marketing year was Southern Africa's maize demand.
“The major maize producers and consumers in the region, such as Zambia, Zimbabwe, and Malawi, all saw notable crop failures because of dryness at the start of this year,” he said.
“While the limited harvest from the fields could cover the next few months of domestic consumption in each country, these countries' import needs could intensify at the end of the year and into 2025.”
Sihlobo also said that besides South Africa, the hope for these countries was that Mexico could export to the region.
However, he said this would depend on whether Mexico planted sufficient maize.
“Unlike in the past, South Africa will likely be unable to satisfy the needs of the regional maize. More information about the regional maize needs will be clearer in the coming months,” Sihlobo said.
“The important thing for South African farmers and traders to do is closely monitor regional maize developments.”
BUSINESS REPORT