Drought puts maize prices under pressure
Mbongeni Mguni | Friday January 18, 2019 12:21
Botswana consumes 120,000 tonnes of maize meal annually, but local production only amounts to 10,000 tonnes annually.
Local millers import the balance from South Africa, whose major white maize producing areas are under increasing pressure due to low and sporadic rains this season. This week, agricultural research groups in South Africa estimated that planted hectarage in the main maize producing provinces of North West and Free State were down to an average of 65%, while the total national estimated harvest would be roughly equal to the disastrous
2015/16 season when mass imports were required. Grain SA CEO, Jannie de Villiers was also quoted by Bloomberg as saying the situation of “current crop status planted, late plantings and even no plantings” meant farmers in South Africa were in “for a very rough ride in 2019”.
Local millers warned that they expected white maize prices to climb soon from the current R2,000 to R4,000 per tonne driven by price pressures in South Africa, including recent fuel hikes in that country and in Botswana.
“We secure our maize grain from SA as well as countries like the US, Mexico and Argentina,” Botswana Millers Association chairperson, Nkosi
Mwaba told BusinessWeek.
“We are subjected to both regional and global market factors as well as the unique price-setting structures in Botswana.
As such grain is an extremely volatile commodity to deal with.”
Mwaba said the association was pushing hard for the commercialisation of maize farming in Botswana, where a lucrative opportunity exists for farmers to plug the gap currently occupied by South African imports.
“We have various challenges working against the growth of this sector, but we are confident that we will find a workable system that is practical and sustainable specifically for Botswana,” he said.