Business Maverick


El Niño’s impact has been erratic for SA commercial grain farmers

El Niño’s impact has been erratic for SA commercial grain farmers
(Photo: Waldo Swiegers / Bloomberg via Getty Images)

South Africa’s summer grains crop is withering in the face of blistering heat waves and a dearth of rain as the El Niño weather pattern sweeps its grim scythe across the countryside. But its impact is far worse in the western regions of the grain belt than in the east. The concern on this front is that most of the staple white maize is grown in the west.

Grain SA’s annual congress at Nampo Park near the Free State town of Bothaville was held on Wednesday beneath a blazing sun, with only a few clouds to puncture the blue of the sky. The sweltering temperatures were a salient reminder of the subject on the minds of the hundreds of commercial farmers in attendance: the weather. 

In the fortnight since the government’s Crop Estimates Committee (CEC) released its first summer grains production forecast for this season, which estimated a 12.6% fall in the maize harvest, the situation has gone from bad to worse.

Read more in Daily Maverick: Crop Estimates Committee forecasts 12% fall in SA maize production

Relentless heat waves have since seared the crop, while rainfall has mostly been scant. Even the CEC’s estimate, which has a two-week lag as it gathers surveys, hardly captured the souring mood in the platteland. 

“The information that was published at the end of February by the CEC was basically two weeks old,” Derek Mathews, chairman of Grain SA, the main industry body for commercial grain farmers, told Daily Maverick in an interview.

“When I participated in the CEC survey, I put down an estimate of 2.5 tonnes to the hectare,” he said, referring to his estimate at the time for his own crop. 

“By the time the actual announcement was made, I didn’t have maize that would give one tonne per hectare.”

Mathews farms in North West, a province that has had far less rainfall than the eastern flank of the grain belt in Mpumalanga.

This is not untypical – as it snakes its way through Gauteng, the N1 is seen as the rough dividing line between the drier and wetter grain-growing areas – but this season is shaping up to be an extreme case.

It’s also what climate change models have been pointing to for years. 

‘A very unfair drought’

“There are large regions in the country where the crop is phenomenally good. We just did a roadshow through the country in preparation for today’s congress, and my assessment is that this a very unfair drought,” Mathews said at a media briefing.

“A ‘fair’ drought is a drought that is bad for everybody, and when it’s bad for everybody, your banker understands it. Your agribusiness understands it … and everybody has the mindset of ‘we need to find a solution here’.

“At the moment, you have pockets of absolute excellence and pockets of absolute disaster. The poor guy who is in an absolute disaster has a fairly difficult task to get everybody into the mindset of ‘you need to be standing next to me’.”

Dirk Strydom, head of marketing at Grain SA, said that within even regions, the crop performance was very uneven. 

“The difficulty with this season is you can’t single out even specific regions. It’s because the rain has been very sporadic all over,” he said.

Still, things are generally worse in the western arm of the summer grain belt, and this is extremely worrying as that is where most of the staple white maize – the key source of caloric intake for South Africa’s poor majority – is grown.

Outlook dims

The upshot is that the CEC’s next estimate, due out on 26 March, is widely expected to be significantly worse than its February forecast, and the outlook is dimming by the day.

In its initial forecast last month, the CEC pegged the maize crop to be 12.6% lower, to around 14.35 million tonnes from 15.43 million tonnes last year.

But white maize production was seen falling 17.2% to just over 7.04 million tonnes.

Estimates for both white and yellow maize – the latter used primarily for animal feed – are likely to be slashed, with a chainsaw possibly taken to the white maize forecast.

Grain SA officials still believe that South Africa will be able to meet its own domestic needs for white maize consumption, helped by carryover stocks from last year of more than a million tonnes.

But it may have little if anything to spare for export to other countries in the region, such as Zambia, where a drought disaster has been declared. And the smaller crop bodes ill for food inflation in South Africa at a time when this scourge has been abating. 

White maize futures in South Africa have risen about 25% in the past 12 months to over R5,000 a tonne, their highest levels in 15 months. 

More than just maize

It’s not just maize that is a concern. The CEC forecast soybean production to fall more than 22% this year, and that initial estimate will probably be lowered as well.

And while the drought may be “unfair”, it’s not a complete surprise. 

El Niño, triggered by a warming of surface waters in the eastern Pacific, formed in the middle of last year. It usually brings drought to southern Africa. 

So, South African farmers who planted summer grain crops late last year knew it was a risk – farming is by nature a risky business – but they forged ahead and devoted slightly more land to planting this season. But moisture levels were generally good at planting time and the full wrath of El Niño – which is forecast to fade soon – was only unleashed in February. 

This will leave many farmers high and dry as they struggle to cover their input and other costs and debts. But those who have decent crops will reap a windfall from rising prices caused by expectations that the overall harvest will be much smaller.

That is the unfairness of the markets and the farming industry. DM

Absa OBP

Comments - Please in order to comment.

  • Godfrey Parkin says:

    Reporting like this is one of the reasons so many people refuse to take climate collapse seriously. One mention of climate change models, and the rest blaming El Niño which “will fade soon”, suggesting that alles sal reg kom. I get it – nobody wants to accept that temperatures are on a steeply rising curve, or read articles about it. But El Niño is merely a pulse on that curve, with every trough becoming higher than the previous peak. Crop yields are down significantly worldwide, and have completely failed in some cases. And it’s just the beginning of a now inevitable global food crisis that will become a humanitarian catastrophe with a severe impact on civil society. Farmers, governments, businesses, families and individuals need to accept that reality and urgently rethink their strategy for the future. And the media should play a more responsible role in generating that acceptance.

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