Market overview
Markets
November 2013
82
However, the world wheat production forecast is expected to be 6%
higher compared to the previous year (IGC, 2013). This is due to increases
in wheat production from Argentina as well as good yields expected from
Australia. As a result, wheat prices for delivery in December are still -24%
less than a year before (Table 1).
Sunflower
In 2013/2014 sunflower production is expected to decline, owing to
unfavourable weather conditions in Russia and the Ukraine which have
led to harvest delays. Harvest progress in Russia is reported to be less
than half of last year’s pace. Dry weather conditions in Argentina have
led to sunflower planting delays. Sunflower prices gained a lot of support
owing to unfavourable weather conditions as well as an increased demand
from Egypt (IGC, 2013). The nearby domestic sunflower seed prices are
-9% lower than a year before, while the FOB Black Sea sunflower seed oil
prices are -30% lower than a year before (Table 1).
Crop prospects and food situation: Africa
According to the Food and Agricultural Organisation of the United
Nations (FAO) (2013), food security has been one of the major problems
facing Africa. Over the years, there have been some improvements in
certain regions, such as East Africa, North Africa and West Africa. These
improvements have been due to increased cereal crops production.
In Central Africa and Southern Africa, food security continues to
deteriorate; mainly due to civil insecurities and drought conditions.
Figure 1
illustrates the countries in desperate need of food (FAO, 2013);
which could also be seen as a region with increasing food demand. With
neighbouring countries such as Zimbabwe and Lesotho also facing an
increasing demand for food, this is an opportunity for South African
producers to increase the market share in the region. In Zimbabwe the
increasing demand has been because of the decline (18%) in their 2013
maize production.
Graph 1: Total grains: World supply and demand.
Source: IGC, 2013
Graph 2: RSA summer grain and oilseeds price trends.
Source: Grain SA, 2013
An overview of summer grains and oilseeds
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