GLOBAL agriculture needs to keep a close eye on extreme weather events, such as the heatwave knocking various countries in the northern hemisphere, according to Agricultural Business Chamber (Agbiz) chief economist Wandile Sihlobo.
Over the past weeks and months, the US, parts of Europe, and China have all reported cases of heatwaves.
“There are growing concerns that the heat could negatively impact the summer grains, which are still in the early growing stages in these regions. The livestock industry is equally anxious that the extreme heat could lead to increasing animal deaths. For example, in June 2022, over 2 000 cattle died of heat stress in south-western Kansas.
These challenging weather events come at a time when the world is in a food crisis and needs to improve agricultural output.
Last week, the heads of the Food and Agriculture Organisation, International Monetary Fund, World Bank Group, World Food Programme and World Trade Organisation had released a joint statement expressing concerns about growing global hunger, and called for increased government support to boost agricultural production globally.
The statement noted that “the number of acute food insecure people – whose access to food in the short term had been restricted to the point that their lives and livelihoods are at risk – increased to 345 million in 82 countries”.
Sihlobo said that, for now, the US Department of Agriculture (USDA), in its monthly update of the World Agricultural Supply and Demand Estimates report released this past week, had maintained an optimistic view about global grains production.
The USDA believed that output in the 2022/23 season might not fall significantly.
“However, the estimates may not have fully accounted for these heatwaves as there are ongoing events, and it would be interesting to see if these projections change in the coming monthly updates the USDA will release. In the July release, for example, the USDA forecasts 2022/23 global maize production at 1.18 billion tons, only down 3 percent year-on-year (y/y).
The expected lower harvest in various parts of Europe and Argentina was the cause of the expected decline in the overall world wheat harvest. This decline in production would weigh on stocks and could keep prices at relatively elevated levels for longer.
However, agricultural commodity prices had softened over the past weeks from the levels following Russia’s invasion of Ukraine and the disruptions this caused to global agricultural commodity markets.
Sihlobo said positively, the global rice and soya bean production was large, well above the previous season, which would help keep prices of these commodities at softer levels than what was seen at the start of this year.
However, Sihlobo said the extreme weather events in the northern hemisphere were a warning signal for farmers across the rest of the world.
Agbiz believed that one important signal for the southern hemisphere was that it could also face weather events that were more extreme. This region will start its 2022/23 summer crop planting in October this year. The current weather forecast suggested that this region was still in the La Niña phase.
For South African farmers, Agbiz said the country was months away from the new summer crop planting season.
Sihlobo said the challenge of heavy rains in the 2021/22 season could be a reality again in the new season if the unpredictability of events in the world is anything to go by. Therefore, farmers should be on alert for such weather events and use any planting strategies they applied in the 2021/22 season, which allowed South Africa to have a large harvest despite the heavy rains.
“The same goes for the fruits, wine-grapes and vegetable industries. For the livestock industry, the possible heavy rains typically bring a range of diseases that veterinarians should be on the alert for,” Sihlobo said.
BUSINESS REPORT