Categories: NewsPublished On: 16th April 2024

Agri Trends: El Nino weather led to white maize production cuts in Southern Africa

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Maize: As the Southern Hemisphere corn production season draws to a close, the market focus shifted to production prospects for the 2024/25 Northern Hemisphere production season which commenced in April. Given the El Nino weather effects, the South American production season is expected to end better than initially anticipated as year-on-year corn production decreases observed in Brazil throughout the season were offset by increased production in Argentina compared to last season. For Southern Africa however, dry and hot conditions led to significant production cuts and some countries declaring states of national disaster. SAFEX maize prices remain firm, increasing by 36,2% and 7,0% year-on-year for white and yellow maize respectively.

Wheat: CBOT wheat prices edged higher month-on-month increasing by 5,2% for CBOT SRW and by 4,9% for CBOT HRW supported by increased tensions in the Black Sea. The USDA crop progress report rated the U.S. winter wheat at 56% good-to-excellent on April 15, which is a substantial improvement compared to the 28% and 30% ratings recorded for the same period in the last two years. The 2024 local wheat production season started on a positive note. SAFEX wheat prices decreased by 3,0% both week-on-week and month-on-month for the week ending April 12 and decreased by 13,2% year-on-year. Optimistic local production sentiments present downward price risks but the continued uncertainty in the Black Sea region is keeping the market on high alert and limits excessive global wheat price declines.

Oilseeds: CBOT soybean prices followed a decreasing trend, easing by 2,0% month-on-month pressured by forecasts of ample soybean global supplies. The USDA Prospective Planting report showed that soybean planting is expected to increase by 3% in the 2024/25 U.S. production season. SAFEX soybean prices increased both week-on-week and month-on-month by 2,6% and 5,0% respectively supported by dryer and hotter production conditions. As a result, the 2023/24 local oilseeds production is expected to decrease by 34,5% and 18,2% year-on-year for soybeans and sunflower seeds respectively.

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