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Southern Africa’s drought and high grain prices attracted a record 150 attendees to the annual general meeting of the Southern African Cereals and Oilseeds Trade Association (SACOTA) at the Centurion Golf Club on 18 September. The attendees included representatives from all 31 member companies, government officials and several industry guests.
Dr André van der Vyver, executive director of SACOTA, noted in a press release that due to dry conditions over the past season, South Africans have experienced sharp increases in the prices of maize and soya beans. “This is despite lower international prices and a stronger Rand. Prices increased by approximately 20% between January and May 2024, and although they have pulled prices back somewhat from their highs, another spike is not impossible,” he remarked. This will depend on local demand and the demand from neighbouring countries also affected by the drought.
Another factor drawing industry attention is the final size of the crop, with the harvest completed in August 2024. Some maize and soya beans are still being stored on farms, making it difficult to finalise the numbers.
SACOTA’s members collectively handle approximately 85% of South Africa’s commercial grain and oilseed trade, including imports and exports. Physical grain traders account for roughly two-thirds of its membership, while the balance are associated members who provide supporting services to the grain traders.
Read more about Brazilian maize imports here.
Importance of imports
In his address, Dr Konrad Keyser, SACOTA’s chairperson, emphasised the importance of easy access to imports. SACOTA’s multi-international trading members have already imported nine vessels of maize totalling 205 000 tonnes, as well as soya bean cake, with more imports on the way. “The National Agricultural Marketing Council (NAMC) estimates maize imports to be 383 000 tonnes, while some private estimates are even higher. Without these imports, food security would have been at risk and prices much higher,” Dr Keyser stated.
The guest speaker, Prof André Jooste, a council member of the NAMC, discussed the role of the NAMC, the Department of Agriculture, and the industry in shaping ministerial and government policy. Given the current dependence on imports, the topic could not have come at a better time. He emphasised the importance of proactive engagement between industry and government regulators.
Opening the South African market to cost-effective imports from the most competitive exporting countries is crucial to curtail food inflation in the grain and oilseed industry, as well as in secondary industries such as the broiler industry. The latter is the cheapest source of animal protein. Maize and soya bean cake comprise approximately 80% of their input cost. Currently, the preferred suppliers are Argentina, Brazil and the United States.
Dr Van der Vyver, executive director of SACOTA, emphasised the importance of working together as one team for the benefit of all South Africans.
SACOTA honoured Cobus du Plessis with an award for his lifetime of dedicated service to the grains and oilseeds industry. Du Plessis recently retired from his role as head of grain trading at Kaap Agri. – Susan Marais, Plaas Media
