South Africa’s agricultural calendar is packed this week. On Wednesday, the South African Grain Information Service (SAGIS) will release the grain producer deliveries data for the week of 17 January 2020. This covers both summer and winter crops. But we particularly monitor winter wheat data, whose harvest has recently been completed in most regions of South Africa. In the week of 10 January 2020, about 1.3 tonnes of wheat, which equates to 80% of the expected harvest in 2019/20 season, had been delivered to commercial silos.

Also, on Wednesday, Stats SA will release the Consumer Price Index data for December 2019. In November 2019, South Africa’s food price inflation stabilized at 3.5% y/y, the components adding downward pressure were mainly the relatively lower prices of meat; oils and fats; and dairy products.

On Thursday, SAGIS will release the weekly grain trade data (wheat and maize), also for the week of 17 January 2020. In brief, maize exports for the 2019/20 marketing year have thus far amounted to 811 522 tonnes, which equates to 68% of the import forecast for this season (1.2 million tonnes).

At the same time, we expect maize imports of about 525 000 tonnes, all yellow maize, mainly for the coastal provinces of the country. This is up from an estimated 171 622 tonnes in the 2018/19 marketing year. The country has thus far imported 431 821 tonnes of yellow maize.

In terms of wheat, South Africa’s 2019/20 wheat imports could increase by 14% y/y to 1.6 million tonnes because of expected lower domestic harvest on the back of unfavourable weather conditions in the Western Cape. In the week of 10 January 2020, South Africa’s 2019/20 season amounted to 437 303 tonnes, which equates to 27% of the aforementioned seasonal import forecast.

Also, worth noting is that South Africa’s wheat import tariff has been revised down to R776.20 per tonne — a 23% decline from the previous rate. This adjustment follows an uptick in global wheat prices (particularly, US No.2 HRW). How does this work? The adjustments in South Africa’s wheat import tariff are satisfied when the international wheat price (US No.2 HRW) deviates from the ‘base price’ by more than US$10 per tonne for three consecutive weeks. A detailed formula is here.

Also, on Thursday, Stats SA will release the Producer Price Index data for December 2019. South Africa’s food producer price inflation slowed to 3,4% y/y in November 2019 from 4.3% y/y in the previous month.

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