South Africa. Oilseeds and Products Annual. Apr 2014 Квітень 11, 2014
Post forecasts that South Africa will plant a record area of 1.2 million hectares with oilseeds in the 2014/15 MY, which could produce a historical high oilseed crop of 1.8 million tons. This positive trend in oilseed production is mainly driven by investments of more than US$100 million on expanding South Africa’s soybean processing capacity. As a result, South Africa will crush a record of 1.6 million tons of oilseeds in the 2014/15 MY and oilseed meal imports will drop by more than 20 percent to about 580,000 tons.
Due to a demand pull from the expansion of crushing facilities, post forecasts that South Africa will plant a record area of 1.23 million hectares with oilseeds later in 2014, for the 2014/15 MY. As a result and based on average yields, South Africa could produce a historical high oilseed crop of 1.8 million tons.
The Crop Estimates Committee estimated the commercial oilseed crop for the 2013/14 MY at a record high of 1.69 million tons on 1.16 million hectares. Although soybean area planted decreased marginally, a record crop of 832,350 tons is expected, as South Africa’s corn and oilseeds producing areas received particularly good rains since the beginning of February. A 40 percent increase in sunflower production to 778,175 tons is also expected inter alia due to a 19 percent increase in area planted to 598,950 hectares, and good weather conditions.
In the 2012/13 MY, South Africa crushed a record 1.22 million tons of oilseeds, 15 percent more than in the previous year. Post estimates that this record will increase to 1.39 million tons in the 2013/14 MY, and to 1.60 million tons in the 2014/15 MY, due to the increase in the local production of oilseeds and the expansion in crushing capacity. As a result, post predicts that the imports of oilseed meal will decrease by about six percent to 690,000 tons in the 2013/14 MY and by a further 16 percent to 580,000 tons in the 2014/15 MY. Imports of oilseed meal decrease by almost 20 percent in the 2012/13 MY to 730,000 tons.
South Africa invested an estimated R1 billion (US$100 million) the past few years on expanding its soybean processing capacity, due to increased soybean production and to replace soybean meal imports. As a result, about 1.2 million tons of additional oilseed processing capacity has been created, bringing South Africa’s current total oilseed capacity to an estimated 2.2 million tons per annum. Currently, South Africa produces about 1.6 million tons of oilseeds. Due to this demand pull, post forecasts that a record area of 1.23 million hectares will be planted with oilseeds later in 2014, for the 2014/15 MY (marketing year starts March, 1, 2015). Post forecasts an 11 percent growth in the area planted with soybeans to 560,000 hectares, due to the added soybean crushing capacity and the increased affinity by farmers to use soybeans as a rotational crop with corn. Post forecasts that sunflower seed and groundnut planted areas will only increase marginally to 610,000 hectares and 60,000 hectares, respectively.
Based on average yields, post forecasts that South Africa will produce a record of 1.8 million tons of oilseeds for the 2014/15 MY. Soybean production will increase by 11 percent to 920,000 tons, while sunflower and groundnut production will increase to 795,000 tons and 85,000 tons, respectively.
The South African Crop Estimates Committee (CEC) released its first oilseeds production estimate for the 2013/14 MY (marketing year starts March, 1, 2014) on February 27, 2014. The CEC estimated the commercial oilseed crop at a historical high of 1.69 million tons on 1.16 million hectares. Although soybean area planted decreased marginally to 502,900 hectares, a record crop of 832,350 tons is expected, as South Africa’s corn and oilseeds producing areas received particularly good rains since the beginning of February. A 40 percent increase in sunflower production to 778,175 tons is also expected. Most of the sunflower production in South Africa is taking place in the Northwest Province and the western side of the Free State Province, while soybeans are produced mainly in the eastern side of the Free State Province and in Mpumalanga Province.
Sunflower seed plantings increased by 19 percent to 598,950 hectares, mainly due to dry weather conditions that persisted during the normal planting period for corn, and as a result many farmers had to switch to sunflower production. The CEC estimates that the peanuts crop will double to 82,365 tons, due to the excellent weather conditions that persisted during February and March.
Post forecasts that South Africa will consume about 1.86 million tons of oilseeds locally in the 2014/15 MY, an increase of 13 percent from the estimated utilization of 1.65 million tons in the 2013/14 MY. Approximately, 1.6 million tons of oilseeds will be crush in the 2014/15 MY. As already mentioned, South Africa’s current crushing capacity increased to an estimated 2.2 million tons per annum after new soybeans crushing facilities were added.
Almost the entire sunflower crop is destined for the processing industry for conversion to sunflower oil. The crushing capacity for sunflower seeds in South Africa is estimated at around one million tons per annum, while the capacity of oilseed refineries is estimated at 950,000 tons per annum. In years of lower sunflower production, the activities at crushing plants are reduced and the refineries import more crude oil, as it is more cost effective than importing sunflower seeds.
Sunflower meal, a by-product of the oil extraction process, is sold to local animal feed manufacturers. Sunflower meal is generally regarded as a low-value product that does not compare well to soybean meal in terms of nutritional value and fiber content. As a result, broiler rations cannot include more than seven percent sunflower meal. Hence, sunflower meal is mainly used as feed in the dairy and beef industries. Post estimates that 750,000 tons of sunflower seed will be crushed in the 2013/14 MY, 13 percent higher than the previous marketing year, as a higher sunflower seed crop is expected.
There is increasing trend in the local utilization of soybeans in South Africa, mainly driven by an increase in crushing capacity. With the increase in crushing capacity, South Africa crushed a record 561,000 tons of soybeans in the 2012/13 MY. Post estimates South Africa will crush 640,000 tons and 820,000 tons of soybeans in the 2013/14 MY and 2014/15 MY, respectively. The local demand for soybean meal, as the preferred source of protein for animal feed, has increased in correlation with the increase in poultry production in South Africa and more than doubled over the past decade. As local production of soybean meal was limited in the past, almost all of the local consumption had to be imported. With the expansion of the local soybean crushing industry and soybean production, imports are expected to decrease to less than 30 percent of local consumption compared to more than 60 percent two years ago.
The domestic market is relatively stagnating at around 60,000 tons, with about 30,000 tons of peanuts being consumed in the direct edible market and about 25,000 tons for the peanut butter market.
South Africa’s trade in oilseeds is mainly directed to the imports of oil and protein meal, however, in the 2012/13 MY, South Africa imported about 95,000 tons of sunflower seeds, due to the drought conditions that affected the 2012/13 MY crop. Zero sunflower seeds imports are expected for the 2013/14 MY, as good weather conditions guaranteed a 40 percent higher sunflower seed crop.
South Africa exported a small amount of 15,000 tons of soybeans in the 2012/13 MY, destined mainly for the premium tofu markets of Malaysia. Exports of soybeans are expected to drop to zero in the 2013/14 MY and 2014/15 MY, as local production is expected to only match the current local crushing capacity in the next five years.
Exports of peanuts (according to SAGIS) reached about 10,000 tons for the 2012/13 MY. However, due to the drought conditions South Africa also had to import 28,711 tons of peanuts in the 2012/13 MY. Exports are expected to increase to 18,000 tons in the 2013/14 MY and to 25,000 tons in the 2014/15 MY, due to an increase in local production.
Local sunflower prices are trading 14 percent higher than a year ago, while soybean prices are trading almost 40 percent higher. A major factor supporting higher domestic agricultural commodity prices is the depreciation of the Rand against other major currencies. For example, the Rand has depreciated by almost 20 percent against the United States dollar in 2013 and by nearly 8 percent in the first month of the 2014. The rand stumbled to a fresh five-year low against the dollar in January, after the start of another labor strike in the mining sector. South Africa's budget and current account deficits, strikes in the manufacturing and mining sectors, and the 2014-elections, make the currency more vulnerable than most emerging market peers during a period of global risk aversion. The domestic soybeans prices were also supported by the increase in local demand (due to the construction of extra crushing plants), which meant that prices moved closer to import parity.
In the 2012/13 MY, South Africa crushed a record 1.22 million tons of oilseeds, 15 percent more than in the previous year. Post estimates that this record will increase to 1.39 million tons in the 2013/14 MY, and to 1.60 million tons in the 2014/15 MY, due to the increase in the local production of oilseeds and the expansion in crushing capacity. As a result, local produced oilseed meal will increase by more than 35 percent to 984,000 tons in the 2014/15 MY, from the 727,000 tons produced in the 2012/13 MY. Crushing yields used includes 42 percent meal for sunflower seeds and 80 percent meal for soybeans.
South Africa’s consumption of oilseed meal stayed constant at approximately 1.5 million tons in the 2012/13 MY, as slow economic growth and high feed prices resulted in growth of less than two percent in the demand for animal feed. The business environment is not expected to improve in 2014, as feed prices are expected to remain at relatively high levels and upwards inflationary pressures and weak economic growth are dimming consumer demand. South Africa’s economy is expected to grow by less than three percent in 2014 and 2015, due to labor unrest, a relatively weak exchange rate and electricity constraints. Hence, post estimates that the consumption of oilseed meal will grow by only about three percent in the 2013/14 MY and 2014/15 MY.
There is the trend in the replacement of oilseed meal imports with locally produced oilseed meal in South Africa. Post expects that South Africa will import less than 40 percent of oilseed meal consumption in the 2014/15 MY.
Imports of oilseed meal decrease by almost 20 percent in the 2012/13 MY to 730,000 tons, on increased local production. Almost all imports of oilseed meal were from Argentina. For the 2013/14 MY, post predicts that the imports of oilseed meal will decrease by about six percent to 690,000 tons and in the 2014/15 MY, oilseed meal imports will decrease even further to around 580,000 tons, or 37 percent of local consumption.
Post estimates that South Africa will produce about 400,000 tons of oilseed oil in the 2013/14 MY. This is almost 14 percent more than the 353,000 tons produced in the 2012/13 MY. For the 2014/15 MY, post forecasts that locally produced oilseed oil will increase to 444,000 tons, due to the increase in the local crushing capacity. Crushing yields used include 38 percent oil for sunflower seed and 18 percent oil for soybeans.
South Africa consumes about1.1 million tons of oilseed oil per annum. Post estimates that the consumption of oilseed oil will grow only by about two percent in the 2013/14 MY, to 1.1 million tons, and by another two percent in 2014/15 MY to 1.12 million tons. Economic growth is the main overall driver for the increase in the demand for oilseed oil and, as already mentioned, South Africa’s economy is expected to grow by less than three percent in 2014 and 2015.
South Africa imported 818,014 tons of vegetable oil in the 2012/13 MY, nine percent less than in the previous season. Major oils imported included palm oil (about 380,000 tons), soybean oil (about 205,000 tons) and sunflower oil (about 130,000 tons).
For the 2013/14 MY and 2014/15 MY, post expects oilseed oil imports to decline, due to the increase in the local production of oilseeds and the expansion in crushing capacity. Sunflower oil imports are expected to drop to about 100,000 tons, while soybean oil imports could drop more than 10 percent to about 180,000 tons.
South Africa also exports oilseed oils to neighboring countries such as Zimbabwe and Mozambique. In the 2012/13 MY, South Africa exported almost 90,000 tons of oilseed oil. These exports are expected to continue at the same level in the 2013/14 MY and 2014/15 MY