Coarse grains stocks to rise
Source: Coarse grains stocks to rise | The Financial Gazette November 16, 2017
Good weather raised maize yield levels in southern Africa.
By Farai Mabeza
COARSE grain stocks are set to increase in southern Africa on the back of increased production in 2017 and slowly rising consumption, the Food and Agriculture Organisation (FAO) has said.
Coarse grains are cereals, with the exception of wheat and rice.
According to FAO’s Food Outlook report published last week, a record production in 2017 amid a slow rising utilisation is likely to contribute to a further expansion in world inventories.
“FAO forecasts global coarse grain production in 2017 to exceed the previous year. Most of the increase is associated with higher maize production in southern Africa and South America, more than offsetting the expected reduction in the United States,” FAO said.
Total utilisation of coarse grains in 2017/2018 is forecast to increase rather marginally with the feed use growing by only 0,3 percent from 2016/2017.
In southern Africa, good weather raised yield levels above prior year’s levels, and higher prices encouraged an increase in plantings in South Africa, supporting a record output of 17,5 million tonnes, more than double the drought-affected production of 2015.
Similarly, favourable weather conditions in the neighbouring countries of Malawi, Zambia and Zimbabwe resulted in strong production rebounds this year.
By contrast, maize imports in Africa in 2017/2018 are projected to decline by 1,9 million tonnes, or 8,3 percent, to just under 21 million tonnes.
This decrease is primarily driven by a sharp cut in purchases by several countries in southern Africa, mainly because of production recoveries.
In South Africa, traditionally a leading regional exporter, no imports will be needed following a strong rebound in domestic production.
Two years of consecutive poor harvests forced the country to import nearly two million tonnes of maize annually.
Imports by Zimbasbwe are also expected to drop from over 900 000 tonnes in 2016/2017 to almost nil, reflecting this year’s bumper crop and a government ban on maize imports that was announced in June.
Industrial use of coarse grains is also expected to experience a below-average increase, largely because of a weaker intake of maize for production of biofuels.
Based on latest forecasts for global production and utilisation, world stocks could rise to a new record level.
Maize and barley inventories are behind this projected rise, mostly in Brazil, South Africa and the United States, while sorghum stocks are heading for a decline, mostly in Argentina, Australia and China.
Overall, the major exporters’ stock-to-disappearance ratio is forecast to increase further in 2017/2018, which indicates more abundant export availabilities of coarse grains for world markets during the current season.
This, in turn, should comfortably meet the current projected rise in import demand.