Maize. Picture: FINANCIAL MAIL
Maize. Picture: FINANCIAL MAIL

Grain SA expects a 2017 maize surplus after last year’s drought-induced deficit, and its surveys show farmers have planted 2.4mha this season — an 18% increase over 2016, its CEO Jannie de Villiers said on Thursday.

"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 — about 2.4mha," de Villiers said. "Having planted those hectares, and looking at the weather forecast for the next month or two, there is a big chance that we will have more than enough for our own use."

A surplus could help to dampen food price inflation in SA. Prices for white maize used for human consumption doubled in 2015 but fell 24% in 2016. It could also have implications for regional food security because countries such as Malawi may still need to import maize. 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 estimate the size of the expected surplus. SA’s harvest of the staple last year was 7.5m tonnes, 25% lower than the 9.95m tonnes in 2015, caused by an El Niño-triggered drought. Domestic consumption is about 10.5m tonnes.

The Grain SA planting estimate is less than the 2.62mha the government’s Crop Estimates Committee said in November that farmers intended to plant. Its first estimate for the area planted is due on January 26.

The drought pushed some commercial farmers out of business or forced them to sell their farms. "There are quite a few farms on the market, especially in the North West province. I assume this means there have been people who lost their farms," de Villiers said.

In the longer run, he said demand for yellow maize — used in SA primarily for animal feed — was 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 SA’s mostly black working class, would flatten. "The white maize market is stagnant; 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 maize will definitely be above population growth."

Reuters

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