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Food prices may soar

Publishing Date : 23 February, 2015


Maize and Wheat Millers Association of Botswana, Nkosi Mwaba

Dry weather conditions in South Africa are likely to affect maize prices and this will potentially push for high food prices in Botswana. Botswana millers import most of their maize from South Africa.

According to the chairman of the Maize and Wheat Millers Association of Botswana, Nkosi Mwaba, Hot and Dry weather conditions in South Africa have caused a significant impact on the availability of white maize crop.  

“Furthermore, the irrigated maize produce which makes up almost 20% of the crop has also being affected by power cuts.  This may result in South Africa having to import maize,” he said.

Mwaba said these concerns have seen corn futures spiking on the Johannesburg Safex (South African Futures Exchange).

At some stage there were concerns that a quarter of South Africa's maize crop could be ruined, as extreme heat and dry conditions sweep through its corn-producing regions.

Reports from South Africa indicates that Africa's biggest grain producer planted 2.656 million hectares for the 2015 season, according to January estimates, and shortages may result in reduced exports to some of its southern African neighbours.

According to Mwaba, the Botswana milling industry is largely dependent on South African maize crop and imports up to 95% of its annual requirements. He said the local milling industry has the capacity to supply the domestic Botswana market with maize meal.  

Maize prices have increase by up to 40% since December 2014. In reaction to this, the market should expect an increase in the price of finished product from as early as March 2015, explained the Chairman of Maize and Wheat Millers Association of Botswana.

The Millers Association of Botswana cautions that the market is likely to see high maize meal prices in both countries for the next 12 months. “We would like to caution the market on the likely increase in the price of maize chop (animal feed) to the beef sector.”

In other reports from South Africa, Grain SA cautioned on Friday that some farmers "stated that they deem this their worst harvest in their 30-40 years of planting".

"In some regions, there is already permanent damage, where no amount of rainfall can relieve the damage," the group said, terming the weather over the next few days as "critical", with rain "urgently needed".

The price of white maize, which is a staple among 90 per cent of South Africa's population, has spiked to 2,636 rand (224 dollars) a tonne, its highest level in a year.

Soaring temperatures in the North West and Free State provinces have caused maize and other grains such as sunflower and soya beans to deteriorate. "We have seen large areas where the damage is already irreversible," said Jannie de Villiers, GrainSA Chief Executive of reported.

The rolling power cuts that have gripped Africa's most advanced economy are also affecting the crops as irrigation systems stop when the power is turned off. Eskom which supplies about 95 per cent of South Africa's electricity is battling to meet its daily demand of about 30,000 megawatts and has had to reduce demand through controlled power cuts.



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