SA, Zambia surpluses stabilise regional maize supplies

  • by African Times
  • 6 Months ago
  • 0

SAVIOUS KWINIKA

SUPPLIES of the staple maize remain high and sufficient to satisfy needs for the remainder of the 2017/18 marketing year in Southern Africa thanks to surpluses recorded mostly in South Africa and Zambia.

Aggregate net supplies in the region remain significantly above average for the marketing year with surpluses of over 4,6 million tonnes, which offsets drought conditions in Madagascar, Malawi, Mozambique and Zimbabwe among other Southern African Development Community (SADC) regional member states. During the marketing period, maize prices in the region have also been below average owing to the above average supplies.

According to the Famine Early Warning System Network (FEWS NET), the marketing year has been characterised by a dynamic trade policy environment.

Recent updates to maize trade policies within the region have been oriented toward facilitating trade, rather than restricting it.

Also, exports beyond the SADC region are supported by favorable marketing conditions including exportable surpluses and competitive price levels.

The Zambian government lifted trade restrictions in May 2017, triggering historically high levels of maize outflows to the southern Democratic Republic of Congo (DRC).

With above-average supplies this marketing year, Malawi and Tanzania lifted maize export bans in October and November respectively to encourage trade.

However, in early February this year (2018), the government of Malawi re-instituted the maize and maize products export restriction amidst anticipated below-average production spurned by drought conditions.

While the maize import ban remains in place in Zimbabwe, international and regional imports continued, likely as a result of unfulfilled import commitments of the previous marketing year.

South Africa and Zambia have meanwhile been exporting to countries outside the SADC region.

The former has been exporting to East Asia and Kenya, east Africa.

Paul Makube, Agricultural Economist for the First National Bank (FNB) in South Africa, said weekly export sales came in at 31, 688 tonnes with Taiwan accounting for 88 percent of the total. This brought the total for the season to date to 1,37 million tonnes with Asian markets so far accounting for 90 percent of the overall exports this marketing season, the economist stated.

In South Africa, prices of the commodity are likely to remain depressed, further encouraging regional and international trade. Prices are not expected to exceed R3 (US$0,26) per kilogramme locally.

Nonetheless FEWS NET projected net maize supplies for the region in the 2018/19 marketing year might be slightly below or close to average, a scenario that may exert upward pressure on maize prices. Substantial maize deficits are expected in typically grain deficit countries.

Regional procurement by humanitarian organizations from Zambia, the main non-genetically modified organism (GMO) maize market, may have limited or no surpluses.

Stringent national regulations on GMOs in some of the grain deficit countries might continue to restrict humanitarian imports of maize grain from South Africa. – CAJ News

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