Article
Mixed rainfall changes SA agricultural outlook
Published: 11/01/2018
I concluded 2017 with a positive outlook for South Africa’s agriculture in 2018 – underpinned by good chances of La Niña weather conditions during the 2017/18 summer season. This essentially meant that the country was expected to receive above-normal rainfall, which would have been good for agricultural activity - Wandile Sihlobo, Agbiz Economist - This article first appeared in Business Day, 11 January 2017
I concluded 2017 with a positive outlook for South Africa’s agriculture in 2018 – underpinned by good chances of La Niña weather conditions during the 2017/18 summer season. This essentially meant that the country was expected to receive above-normal rainfall, which would have been good for agricultural activity.
Disappointingly, that picture has somewhat changed and is now mixed. The eastern parts of South Africa received good rainfall during the festive season, and crops are generally in a fair condition, albeit, having been affected by hail in some areas. This area generally covers Mpumalanga, Kwa-Zulu Natal, the eastern Free State and the northern parts of the Eastern Cape province.
Meanwhile, the central and western parts of South Africa received very little rainfall in the last few weeks of 2017 and they have also had a drier start to 2018. This led to delays in summer crop planting activity, particularly in the North West, and the western parts of the Free State. These provinces collectively account for 68% of the intended maize planting area of 2.47 million hectares in the 2017/18 season. They also account for the lion’s share (86%) of the 665 500 hectares intended for sunflower seed production in the 2017/18 season.
The most recent survey from Grain SA suggests that farmers in both these provinces were unable to meet their maize planting intentions due to persistent dryness. Farmers in the North West have planted 70% of the intended area of 580 000 hectares. Meanwhile, farmers in the central and north-western parts of the Free State province have planted roughly 75% of their intentions.
The optimal maize planting window has already passed, so even if South Africa was to suddenly receive widespread showers, there would be minimal improvements in planting activity in these particular provinces. Any maize planted outside the optimal window risks being affected by frost later in the season, which in turn, increases the likelihood of poor yields.
In terms of sunflower seed, farmers have thus far planted roughly 40% of their intentions in the North West province. In the north-western parts of the Free State province, the progress is much slower, with only 20% of the intended area planted so far. Fortunately, the optimal planting window is still open until 20 January 2018. Therefore, if South Africa happens to receive good rainfall before this cut off date, farmers could still plant sunflower seed.
At the time of writing, the weather forecasts were painting an optimistic picture of between 16 and 60 millimetres of rainfall in weeks between 9 and 24 January 2018. While this will not be sufficient to fully replenish soil moisture, it will be a welcome development following weeks of dryness.
Fortunately, these developments come on the heels of a very good season with record maize and oilseed harvests in the 2016/17 production season. This means the country is still well supplied in the short to the medium term. This good availability is also reflected in commodity prices, which are still under pressure despite the unfolding unfavourable weather conditions. On 9 January 2018, the white maize spot price was roughly 40% lower than the corresponding period last year, trading around R1 991 per tonne and the sunflower seed spot price was down 14% year-on-year, trading at around R4 757 per tonne.
On balance, while this is an immediate concern for farming communities, the outlook on food inflation will not change significantly in the near-to-medium term due to the buffer of large stocks from the previous season. Overall, a clearer picture of South Africa’s 2017/18 grain and oilseed production will unravel later this month when the National Crop Estimate Committee releases its preliminary planting estimates data. For now, we can just kneel and pray for rainfall. Perhaps, the expected La Niña will materialize later in the season, hopefully not too late for all the crops as some are already wilting.
This article first appeared on Business Day, 11 January 2017
Enquiries: Wandile Sihlobo (Agbiz economist)