Agriculture
#Agbiz: Reflections on the resilience of SA's key imported agricultural products─── 05:00 Wed, 20 Apr 2022
As usual on the Agri Hour, Wandile Sihlobo, chief economist at the Agricultural Business Chamber of South Africa, Agbiz, provides a weekly insert about the latest on the global as well as South African agricultural markets.
He also provides more information about the latest developments in the agricultural sector.
See PODCAST below
In this week’s segment, Sihlobo takes a look at rice imports.
“Rice ranks second in the four major agricultural products that South Africa imports annually, and account for 7% of the US$6,9 billion spent on agricultural product imports in 2021. Other products are wheat, palm oil and poultry products.
“In volumes terms, South Africa imported about 1,1 million tonnes of rice, both for annual consumption and exports to the neighbouring countries. The latest data from the International Grains Council suggests that this volume could remain unchanged in 2022.
“Typically, about 70% of South Africa's rice is usually imported from Thailand, with other notable suppliers being India, Pakistan, China and Vietnam. Most of these countries currently expect a reasonably good harvest in the 2021/22 season, which should boost the availability of supplies for exports.
"Hence, the United States Department of Agriculture forecasts the global rice production at 513 million tonnes in the 2021/22 season, up by 1% from the previous season.
"Consequently, the 2021/22 global rice stocks are forecast at 189 million tonnes, up by 1% from the prior season. What is worth noting is that the Russia-Ukraine war has disrupted the global grains market and raised concerns about the potential increase in rice demand in the coming months, as some countries could start using rice to substitute for maize and other grains where supplies will be relatively scarcer and prices higher.
“Interestingly, while other grains prices have remained volatile the past few weeks, rice prices have been reasonably stable, and we have not yet observed a drastic increase in demand. Rice prices have declined significantly over the past few months.
"In March 2021, Vietnam and Thailand's rice prices were just over US$500 per tonne, and by March 2022, these prices had declined to just under US$420 per tonne.
“This softening in prices persisted a month after the invasion of Ukraine by Russia while prices of commodities like wheat, maize and vegetable oil increased notably. Such price trends bode well for rice importing countries such as South Africa,” concludes Sihlobo.
