Brief Overview of the Current South Africa Grain Supplies. 19 February 2016

Transcription

1 Brief Overview of the Current South Africa Grain Supplies 19 February

2 Background on the Grain Supply Industry RSA growers produce 42% of all maize in SADC SADC is a net importer of RSA maize RSA Summer grain production yield decreases 27%y/y in 2015 (maize -30%y/y). RSA 2016 maize production might decrease further by 25%y/y. 2

3 Million tons Maize Production : Negatively Affected Across the Region SA ZAM MOZ TAN MAL ZIM KEN EST 2016 Source: BFAP and Grain SA 3

4 1991/ / / / / / / / / / / / / / / / / / / / / / / / /16* 000 Tons RSA Total Maize Production Lowest since 2006/ Source: Grain SA 4

5 000 tons White maize Production is at the lowest level since Noordwes/North West Gauteng Limpopo Mpumalanga Kwazulu-Natal Oos-Kaap/E. Cape Vrystaat/Free State Noord-Kaap/N. Cape Wes-Kaap/W. Cape Source: Grain SA 5

6 000 tons Yellow Maize Production Lowest since 06/ Noordwes/North West Gauteng Limpopo Mpumalanga Kwazulu-Natal Oos-Kaap/E. Cape Vrystaat/Free State Noord-Kaap/N. Cape Wes-Kaap/W. Cape Source: Grain SA 6

7 Index 2004/05 = 100 RSA Production: All Summer Crops have been Negatively Affected Source: Grain SA Groundnuts (-48% y/y) Soybean (-27% y/y) Maize (-25% y/y) Sunflowerseed (-6% y/y) 7

8 Index 2004/05 = 100 Production: All Summer Crops have been Negatively Affected Groundnuts (-48% y/y) Soybean (-27% y/y) Maize (-25% y/y) Sunflowerseed (-6% y/y) Source: Grain SA 8

9 Index 2004/05 = 100 Production: All Summer Crops have been Negatively Affected Groundnuts (-48% y/y) Soybean (-27% y/y) Maize (-25% y/y) Sunflowerseed (-6% y/y) Source: Grain SA 9

10 '000 Tons Continuous Growth in Demand of RSA Maize for Feed Consumption Human Consumption Feed Consumption Source: Grain SA 11

11 Tons YMAZ: Maize for Animal Feed At Higher Levels Jan 2013 June 2013 Nov 2013 Apr 2014 Sep 2014 Feb 2015 July 2015 Dec animal -human Source: Grain SA 12

12 Tons WMZ: Maize for Animal Feed Peaks July Feb Jan 2013 June 2013 Nov 2013 Apr 2014 Sep 2014 Feb 2015 July 2015 Dec human -animal Source: Grain SA 13

13 000 Tons 000 Tons Commercial Demand Remains Strong / / / / /16* 2016/17** Source: Grain SA Imports Carry-out stocks Total commercial demand Whole maize exports Production 14

14 RSA White Maize: Supply and Demand 2014/ /16* 2016/17 (3.16) Opening stocks Commercial Deliveries Mexico Imports Total supply RSA consumption Exports Total demand Carry-out (30 Apr) Surplus/deficit above pipeline Area planted (x1 000 ha) Yield (ton/ha) & Zam

15 RSA Yellow Maize: Supply and Demand Area planted (x1 000 ha) Yield (ton/ha) / /16* 2016/17 (4.33) Opening stocks Commercial Deliveries Imports Total supply RSA consumption Exports Total demand Carry-out (30 Apr) Surplus above pipeline Arg.

16 RSA Total Maize : Supply and Demand Area planted (x1 000 ha) Yield (ton/ha) / /16* 2016/17 (4.53) Opening stocks Commercial Deliveries Imports Total supply RSA consumption Exports Total demand Carry-out (30 Apr) Surplus above pipeline

17 Tons RSA Traditionally a net exporter Source: Grain SA Imports Exports 21

18 Tons % RSA exports to SADC RSA Exports to SADC Likely To Continue % 100% 80% 60% 40% 20% 0% Source: Grain SA Imports Exports % RSA exports to SADC 22

19 % imports of annual maize consumption SADC: Expected % Imports of Annual Domestic Consumption 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Source: USDA, ITC and Grain SA 23

20 Million tons Global Maize Supply Remains at High Levels / / / /16 Production Consumption Ending Stocks Source: IGC and Grain SA 24

21 KEY COMMODITY PRICE MOVEMENTS 25

22 ZAR/T US$/T Maize and Rice Prices have Peaked Rice (Thailand) Yellow Maize White Maize US Maize 50 0 Source: JSE, IGC and Grain SA 26

23 01-Jan Jan Feb Mar Mar Apr May May Jun Jul Jul Aug Sep Oct Oct Nov Dec Dec Jan Feb Feb-16 ZAR/USD Continuous Depreciation of the ZAR Adds Inflationary Pressure Source: Bloomberg and Grain SA 27

24 15-Feb Apr Jun Aug Oct Dec Feb Apr Jun Aug Oct Dec Feb Apr Jun Aug Oct Dec Feb-16 R/ton White Maize Price is well Above the Import Parity Price USA Import Parity Safex WM USA Export Parity Source: IGC and Grain SA 28

25 1-Oct-12 1-Dec-12 1-Feb-13 1-Apr-13 1-Jun-13 1-Aug-13 1-Oct-13 1-Dec-13 1-Feb-14 1-Apr-14 1-Jun-14 1-Aug-14 1-Oct-14 1-Dec-14 1-Feb-15 1-Apr-15 1-Jun-15 1-Aug-15 1-Oct-15 1-Dec-15 1-Feb-16 R/ton Yellow Maize Price is at Import Parity Price Level USA Import parity Safex YM ARG Import Parity USA Export Parity Source: IGC and Grain SA 29

26 SOUTH AFRICAN WHEAT PRODUCTION 30

27 000 ton RSA Wheat Production is under Pressure / / / / / / / / /15 Source: Grain SA NOK produksie skatting/cec crop estimate ('000ton) Totaal RSA verbruik / Total RSA consumption Linear (NOK produksie skatting/cec crop estimate ('000ton)) Linear ( Totaal RSA verbruik / Total RSA consumption) 31

28 000 ton % RSA is Increasingly Importing more Wheat / / / / / / /15 Invoere / Imports % invoere t.o.v RSA verbruik/ % imported of RSA consumption 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Source: Grain SA 32

29 RSA Wheat: Domestic Demand and Supply 2013/ /15* 2015/16** Opening stocks Commercial Deliveries Imports Total supply RSA consumption Exports Total demand Carry-out 33 (30 Sep)

30 Million tons Global Wheat Supply Remains at High Levels / / / /16 Production Consumption Ending Stocks Source: IGC and Grain SA 35

31 01-Jan Jan Feb Mar Mar Apr May May Jun Jul Jul Aug Sep Oct Oct Nov Dec Dec Jan Feb Feb-16 ZAR/USD Continuous Depreciation of the ZAR Adds Inflationary Pressure Source: Bloomberg and Grain SA 36

32 1-Oct-12 1-Dec-12 1-Feb-13 1-Apr-13 1-Jun-13 1-Aug-13 1-Oct-13 1-Dec-13 1-Feb-14 1-Apr-14 1-Jun-14 1-Aug-14 1-Oct-14 1-Dec-14 1-Feb-15 1-Apr-15 1-Jun-15 1-Aug-15 1-Oct-15 1-Dec-15 1-Feb-16 R/ton Wheat Prices Trade Along Import Parity Prices USA Export Parity Safex USA Import Parity Source: IGC and Grain SA 37

33 04-Oct Nov Dec Jan Feb Mar May Jun Jul Aug Sep Oct14 28-Nov Jan Feb Mar Apr May Jun Jul Sep Oct Nov Dec Jan Jan Feb-16 Weekly Wheat Imports (tons) and Tariff triggers Tariff R461/t Tariff R800/t Tariff R510/t Tariff R911/t Source: SAGIS and Grain SA 38

34 Wheat Farmers only Receive R2.38 in a Loaf of Bread Source: Grain SA 39

35 TOTAL GRAIN IMPORTS FOR 2016 TO APRIL

36 RSA Total Grain and Oilseed Import Estimates for 2016 April 2017 is 7.24 million tons Barley, 0.06 Sorghum, 0.06 Soybean, 0.30 Peanuts, 0.02 Sunflowerseed, 0.10 Rice, 0.90 Maize, 3.80 Wheat, 2.00 Units: million tons Source: Grain SA 41

37 RSA Possible Total Grain Imports for the year. Maize = 3.8 million tons Wheat = 2 million tons Rice = tons Sorghum = tons Barley = tons Soybean = tons Sunflowerseed = tons Peanuts = tons TOTAL GRAIN & OILSEED IMPORT ESTIMATE FOR 2016-APRIL 2017 = 7.24 million tons 42

38 01-Jan Jan Feb Mar Mar Apr May May Jun Jul Jul Aug Sep Oct Oct Nov Dec Dec Jan Feb Feb-16 ZAR/USD Continuous Depreciation of the ZAR Adds Inflationary Pressure Source: Bloomberg and Grain SA 45

39 2016 will see the toughest consumer environment WMAZ Spot price have increased by +80% y-o-y YMAZ Spot price have increased by +45% y-o-y CPI bread & cereal increased by 8.4% y-o-y (Jan 16) PPI cereals & crops increased by 53.7% y-o-y (Dec 15) Maize meal prices increased by 22% y-o-y (Jan 16) Rice prices increased by 5% y-o-y (Jan 16) Beef prices increased by 5% y-o-y (Jan 16) Milk prices increased by 3% y-oy (Jan 16) Egg prices increased by 10% y-o-y (Jan 16) Sunflower oil prices increased by 30% y-o-y (Jan 16) 46

40 THERE ARE CONCERNS ABOUT LOGISTICS 47

41 The usual grain port usage is roughly 4.8 million tons a year DBN ( TONS/Month) CPT ( TONS/Month) PE ( TONS/Month) EL ( TONS/Month) Port Authorities indicated that they can be in a position to accommodate roughly 7 million tons a year. 48

42 Thank You! Wandile Sihlobo Tel: Disclaimer: Everything has been done to ensure the accuracy of this information, however Grain SA takes no responsibility for any losses or damage incurred due to the usage of this information. 49