South Africa to register bumper maize production in 2020/21 with demand driven by local consumption

SOUTH AFRICA – Favourable weather in the Southern Africa region will boost South Africa’s maize/corn production during the 2020/21 market year (MY), to hit the 16 million tons mark, the same level as the bumper harvest of 2019/20, according the latest USDA report.

This current estimate is 14% higher than the previous one by USDA in a GAIN report, which had previously indicated the figure could reach 12.6 million tons.

This is a slight departure from the country’s Crop Estimates Committee (CEC), which released its final production tally indicating that commercial corn crop was at 15.4 million tons on 2.6 million hectares at a national average yield of 5.9 tons per hectare.

The 2019/20 corn crop is the second largest commercial corn crop ever produced in South Africa and 37 percent larger than the 2018/19 MY’s commercial crop of 11.3 million tons, according to the USDA estimates.

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The CEC kept the 2019/20 production estimate for the subsistence farming sector unchanged at 543,545 tons, marginally lower than the 549,180 tons produced in the 2018/19 MY.

This means South Africa’s total corn crop for the 2019/20 MY is estimated at 16.0 million tons on 2.9 million hectares, which is 35 percent more than the 2018/19 MY’s corn crop of 11.8 million tons.

South Africa to remain a net exporter of corn in the 2020/21 MY as commercial production exceeds local consumption

USDA

Human demand drives rise in consumption

In terms of consumption, the report forecasts a rise in 2020/2021 to 11.7 million tons from 11.5 million tons of 2019/20, mainly driven by human consumption demand.

The USDA says that South Africa’s economic growth will still be under pressure in 2021, due to the ongoing COVID-19 pandemic and structural and policy constraints to this end,

To this end many consumers, especially lower income consumers, are shifting more to white corn, in the form of a meal, as relatively inexpensive source of carbohydrates.

With South Africa’s relatively weak economy and high unemployment rate, the report increased its estimate of the human consumption for corn in the 2019/20 MY to 5.8 million tons, an increase of 8 percent from the previous marketing year.

On the other hand, the shrinking local economy is limiting an increase in the demand for animal protein, which could affect the demand for yellow corn, which is used as the primary ingredient for animal feed, especially in the broiler industry.

The USDA reduced its estimate for the demand for corn for animal feed in the 2019/20 MY to 5.6 million tons, a decrease of 3 percent from the 2018/19 MY’s level of 5.7 million tons.

The report reveals that South Africa will remain a net exporter of corn in the 2020/21 MY on an estimated second consecutive bumper corn crop that will see the estimated commercial production exceeding local consumption.

The report predicts South Africa should be able to export around 3.0 million tons of corn in the 2020/21 MY, higher than the 2.5 million tons of corn in the 2019/20 MY.

In the first 8 months of the 2019/20 MY, South Africa already exported 1.9 million tons of corn with South Korea, Taiwan, Zimbabwe, Botswana and Japan the major markets.

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