A JOURNEY THROUGH TIME

THE

GRAIN AND OILSEED INDUSTRY

OF SOUTH AFRICA – A JOURNEY THROUGH TIME

ႄႊ

1998/1999 surplus – first year after deregulation

With the start of the 1998/1999 marketing season South Africa had about 2,61 million

tons of carry-over stock from the previous year, which consisted of 1,37 million tons

of white maize and 1,26 million tons of yellow maize. At that stage the crop estimates

pointed to a crop of about 7,19 million tons of maize that could be expected in that

season, which meant that a total of about 9,8 million tons of maize would be available

in the interior. South Africa’s domestic consumption was estimated at 7 million tons

at the most in that season.

There was therefore an expected oversupply of about 2,8 million tons of maize in the

country, which would undoubtedly harm the producer price. As the Maize Board did

not exist anymore, the producers had to depend on themselves to rectify the situ-

ation. NAMPO, together with the agriculture companies and co-operatives, made a

huge effort to export the maize. For this purpose, the producers were requested to

render 15% of their white and yellow maize crop to an export pool, to be exported

and as such help to restore the domestic supply and demand balance and support

the producer price.

Producers’ involvement in this export effort varied from area to area, but eventually

less than 60% of the goal was reached. The surplus problem was therefore not

solved by the export effort. However, it was clear that the reality of the effects of the

overproduction and unregulated market environment, encouraged the maize pro-

ducers to plant less maize the following season. This contributed to the limiting of

the total maize yield.

2004/2005 surplus

The 2004/2005 production season again delivered a very good maize crop: approxi-

mately 11,7 million tons. It was already clear from the earliest crop estimates that,

given the carry-over stock from the previous years and the expected size of that

season’s crop, it would result in a large surplus on top of the domestic demand. Con-

sequently, the maize prices plummeted, which in turn forced the maize industry into

an enormous crisis and led to the recommendation of Grain SA in September 2004

to drastically limit the planting of maize in the coming season.

The crisis with the surplus led to Grain SA having two mass meetings early in 2005

– one in Centurion and one in Bellville. The meetings were attended by an estimated

6 500 people. The purpose of this was, among other things, to find solutions for the

crisis on the grain industry and to cultivate a better feeling of fellowship among the

producers. During these meetings, the producers’ inputs were obtained and were

afterwards considered during the further process conducted by Grain SA.

THE MAC WAS APPOINTED

IN 1995 IN TERMS OF THE

PROVISIONS OF SECTION 15

OF THE MAIZE MARKETING

SCHEME TO PROVIDE THE

MAIZE BOARD WITH ADVICE

ABOUT SPECIFIC MATTERS.

THE MAC ACTED ONLY IN

AN ADVISORY CAPACITY

AND THE FINAL DECISION

ON HANDLING MATTERS

THAT HAD BEEN REFERRED

TO THE MAC RESTED

WITH THE MAIZE BOARD.

THE MAC CONSISTED OF

24 MEMBERS, AND THE

CHAIRPERSON WAS

MR ATTIE SWART OF

THE DEPARTMENT

OF AGRICULTURE.

The Wolmaransstad study group looked forward to attending

the meeting.

Hundreds of producers and role-players in the grain industry flocked to

SuperSport Park in Centurion.