Vegetable prices expected to increase in 2018
The ongoing drought in South Africa is expected to reflect through the vegetable commodities in 2018. Planting conditions for some vegetable crops (potatoes, onions) were not ideal as irrigation water preference was given to permanent orchards in the Western Cape. Growers in the Western Cape have planted fewer onions than normal; some have not even sown any onions this winter. Crop damage was also seen in some of the tomato crop, due to heat stress. Generally vegetable prices are expected to be slightly higher in 2018 mainly because of lower production. See vegetable section for more insights.
Grains & Veggies
Feeding margins were positive for most of 2017, on the back of low feed costs resulting from the lower grain prices. The beef: maize price ratio (the amount of maize it takes to equal the value of the meat) serves as an indicator for an economic performance of the beef industry. Should this price ratio trade above a break even ratio of 13, then the industry is deemed to be doing well. This price ratio in 2017 was deemed favourable for most of the year, and was the best it has been in 8 years.
The 1st estimate for the 2017/18 production year indicates a cotton crop of 189 779 lint bales for the RSA, an increase of 145% over the previous season. This is mainly due to the more favourable prices of cotton in relation to competitive crops.
There are concerns regarding the scarcity of wool with smaller auctions now expected due primarily to the impact of the drought. There were smaller volumes at the latest auction again this week, and volumes on offer where 10% lower compared to the previous auction
Published on Monday, 12th February 2018 - 09:57