The excessive rains since the start of South Africa’s 2021/22 summer crop production season in October 2021 have raised concerns that farmers might not have been able to till the initially planned 4.34-million hectares, industry organisation the Agricultural Business Chamber (Agbiz) says.
Preliminary plantings data released on January 27 by the Crop Estimates Committee showed that expectation to be accurate.
However, Agbiz says the actual plantings data includes some positives, as many analysts, including the organisation, thought it would be a much smaller area.
Farmers are estimated to have planted 4.21-million hectares, which is 3% less than their target at the start of the season.
The slight declines are in maize, soybeans, groundnuts, sorghum and dry beans.
Meanwhile, sunflower seed plantings are up from the initial targets.
Agbiz posits that the best way to view this data is by comparing it with the area planted in the 2020/21 production season, and from this perspective, farmers planted 0.4% more hectares.
The increase is on sunflower seed (up 21% year-on-year with 580 000 ha) and soybeans (up 10% year-on-year with 910 000 ha).
For these crops, the estimated area is above the ten-year average plantings, and is also a record area for soybeans, Agbiz acclaims.
Other crops’ area declined, specifically maize, whose plantings fell by 5% year-on-year, with 2.61-million hectares. However, Agbiz emphasises that this is above the ten-year average area planting of 2.53-million hectares.
Moreover, the groundnuts area is down by 12% year-on-year, with 34 000 ha, which is below the ten-year average of 43 348 ha.
Sorghum and dry beans plantings are down 29%year-on-year and 10% year-on-year, with 35 000 ha and 42 450 ha planted, respectively - below the ten-year average.
Following on from the plantings data, Agbiz focuses on yields, a crop tonnage per hectare.
Looking at the major grains and oilseeds, such as maize, soybeans and sunflower seeds, the yields in the past ten years averaged 5.02 t/ha, 1.78 t/ha and 1.30 t/ha, respectively, it points out.
It notes that the 2014/15 production season was one of the lowest yields, especially maize, as this was a drought year, at 3.75 t/ha.
Agbiz says it is still unclear where the yields will be in the 2021/22 production season.
However, drawing on various industry surveys and its general observations, it assumes that the areas such as the western regions of the Free State, North West, and parts of the KwaZulu-Natal and the Eastern Cape, which received heavy flooding, could realise lower yields than the previous season.
South Africa will need at least an average national yield of 4.60 t/ha to have a maize harvest of 12.01-million tonnes in the current area planting if the country is to have sufficient maize supplies for domestic consumption, Agbiz indicates.
It notes that such a yield estimate is possible given that the floods that caused the damage were not a nationwide challenge, but rather, limited to certain regions of some provinces.
However, it cautions that it will be a month until there are official first production estimates from the Crop Estimates Committee.
“The current plantings data provides some comfort that plantings didn’t decline as notably as some might have feared and are marginally above the 2020/21 production season,” Agbiz says.
However, it cautions that, when the Crop Estimates Committee releases its first production estimates in February, there may be some revisions to these estimates and Agbiz’s estimations.
“For now, we doubt that the planting information will have a notable impact on the domestic grains and oilseeds prices.
First, the grain market participants will now focus on possible yields and weather conditions; this will be more evident over time. Secondly, the domestic grains and oilseeds market is still primarily influenced by global events such as crop conditions in South America, a significant producer in the global market, grains and oilseed demand in China, and most recently, the geopolitics in the Black Sea region. All these global factors present a temporary upside pressure on prices,” Agbiz indicates.
It notes that the global production estimates remain relatively robust, which signals that the medium-term price trend of global grains could be sideways, which could be a reality in South Africa.