South Africa eyes return as corn exporter in 2016-17

09.08.2016

The FAS also indicated that high local corn price levels are expected to influence the area planted to corn in South Africa for the 2016-17 marketing year.
 
South Africa is expected to return to being a net exporter of corn in the 2016-17 marketing year, according to the U.S. Department of Agriculture’s (USDA) Foreign Agricultural Service (FAS) in a July 28 report. The FAS said the country could export about 1 million tonnes of corn during 2016-17.

In the 2015-16 marketing year, the FAS said South Africa will have to import about 3.5 million tonnes of corn, as drought conditions reduced the country’s normal crop production by more than 40%. This comes on the heels of the 2014-15 marketing year in which South Africa imported almost 2 million tonnes of corn to supplement local production, the FAS said.

“Argentina is South Africa’s most favorable trading partner in terms of yellow corn, while Mexico and the United States are preferred suppliers of white corn,” the FAS said. “South Africa will continue exporting corn to its neighboring countries, which should amount to about 700,000 tonnes in the 2015-16 marketing year.”

In the report, the FAS also indicated that high local corn price levels are expected to influence the area planted to corn in South Africa for the 2016-17 marketing year.

“Local corn prices are expected to trade at import parity price levels for at least until next year’s harvest season, giving farmers enough initiative to plant more fields of corn,” the FAS said.

As a result, the FAS said forecasts call for approximately 2.8 million hectares of corn to be planted later in 2016, which is up about 10% from the five-year average for the region. Taking these factors into account, the FAS said South Africa’s corn crop for the 2016-17 marketing year may reach 12.6 million tonnes, which compares with 7.6 million tonnes in 2015-16 and 10.63 million tonnes in 2014-15.


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