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SA grain industry group sees 2017 maize surplus

Pictures: Bongani Hans

Pictures: Bongani Hans

Published Jan 12, 2017

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Johannesburg - South African industry

group Grain SA sees a 2017 maize surplus after last year's

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drought-induced deficit and its surveys show farmers have

planted 2.4 million hectares this season, an 18 percent increase

over 2016, its chief executive said on Thursday.

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"What I've learned from our surveys and discussions with the

farmers is that we will plant, or have planted because it's just

about done now, around 2.4 million hectares," Jannie de Villiers

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told Reuters in a telephone interview.

"If we have planted those hectares and I look at the weather

forecast for the next month or two there is a big chance that we

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will have more than enough for our own use," he said, when asked

if he expected a surplus this year.

A surplus could help to dampen food price inflation in South

Africa. Prices for white maize used for human

consumption doubled in 2015 but fell 24 percent in 2016.

It could also have implications for regional food security

as countries such as Malawi may still need to import. Malawi,

Zambia and Zimbabwe have been hit by an outbreak of armyworm, a

pest that devours maize and other crops.

De Villiers said it was too early to peg an estimate for the

size of the expected surplus.

South Africa's harvest of the staple maize last year was 7.5

million tonnes, 25 percent lower than the 9.95 million tonnes

in 2015 because of an El Nino-triggered drought. Domestic

consumption is about 10.5 million tonnes.

Read also:  SA could export maize again

The Grain SA planting estimate is less than the 2.62 million

hectares the government's Crop Estimates Committee said in

November farmers intended to plant. Its first estimate for the

area planted is due on Jan 26.

The drought pushed some commercial farmers out of business

or forced them to sell their farms, De Villiers said.

"If I look at the market there are quite a few farms on the

market especially in the North West province. I assume with the

number of farms on the market there have been people who lost

their farms," he said.

In the longer run, he said demand for yellow maize - used in

South Africa primarily for animal feed - was seen increasing as

protein consumption gradually rises, a trend seen in other

emerging economies with growing middle classes.

Demand for white maize, the main source of calories for

South Africa's mostly black working class, would flatten.

"The white maize is stagnant, the people are moving away

from it if they can just afford a little bit of chicken or

something like that," De Villiers said.

"The growth in yellow will definitely be above population

growth," he said. 

REUTERS

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