30 April 2020 – Agriculture received some positive news this week. Firstly, it was the further upward revision to the country’s crops estimates with the South Africa’s Crop Estimates Committee (CEC) pegging the 2019/20 crop 17.52 million tons of grain and oilseed crops which is up 2.6% from March and 31.3% higher year-on-year (y/y). At 15.22 million tons, the maize harvest will be the third largest on record having been raised by 2.8% from the previous month and 35% y/y. Encouragingly, soybean output jumped 1.7% from March despite earlier yield concerns to 1.29 million tons which is up 10% y/y. While the sunflower harvest estimate came in unchanged month-on-month (m/m), it is still 10% up on last year. This is good news for consumers as food inflation is expected to remain contained in particularly the bread and cereals which decelerated by 3.8% y/y during March 2020.

       Secondly, it is inevitable that fuel prices are going to fall in May and all indications are that it will be by a big margin. This comes at the time when harvesting gets in to full swing for the summer crop areas while the winter crop planting season begins. The implications are reduced costs for farmers from planting, harvesting, and distribution bearing in mind that the distribution of agricultural produce is dominated by road transport with over 80% of grain is transported by road.

       Thirdly, the lockdown regulations have been eased and wine can now be transported for the critical export market to ensure that we retain our markets and improve cash flows for producers. After earlier confusion with some of the provinces, the issue of livestock has been clarified and sales can continue unhindered.

Pretoria, Gauteng, SA (July 31, 2019) – The SA Revenue Services released trade statistics for June 2019 which showed that the value of the value of hides, skins & leather trade - imports and exports - has fallen this year by comparison with last year, while the value of footwear & accessories trade - imports and exports - has increased. The former figures would have been influenced by the global drop in hides and skins prices.
       Hides, skins & leather trade shows a small trade surplus, while footwear & accessories trade shows a large trade deficit.
       Hides, skins & leather exports for June were worth R298 454 569, while imports amounted to R299 038 667 for a trade deficit of R584 098. The cumulative export figure for January-June was R1 744 940 232 by comparison with R2 098 772 313 for the same period last year. The cumulative import figure for January-June was R1 719 019 253 by comparison with R1 723 207 758 for the same period last year.
       Footwear & accessories exports were worth R205 189 052, while imports amounted to R1 310 668 020 for a trade deficit of R853 610 096. The cumulative export figure for January-June was R1 365 842 651 by comparison with R1 310 668 020 for last year. The cumulative import figure for January-June was R6 683 123 167 by comparison with R6 096 803 721 for the same period last year.

Pretoria, Gauteng, SA – The Competition Tribunal will hear final arguments today in the application by Mosstrich and Klein Karoo International to merge after the Competition Commission earlier this year rejected their application.
       In a release last Monday, the tribunal said:
Two of the largest companies in the ostrich industry are approaching the Tribunal this week in a bid to have a decision by the Commission – to prohibit their merger – reconsidered.
       The Commission earlier prohibited the merger between Mosstrich (Pty) Ltd and Klein Karoo International (Pty) Ltd, after finding that the merger would result in a near monopoly in the market for ostrich meat and feathers. The Commission also found, among others, that the merger was aimed at eliminating competition between the two companies and that they would control the entire value chain of the ostrich industry if the merger was approved.
       However, the companies argue that the proposed transaction is an attempt to stabilize the ostrich industry which is in a state of decline. They submit that there is no incentive for them to exploit the local market. They maintain that the case, on the whole, does not make out a case for prohibition. They also submit, among others, that the proposed merger will aid the survival of the ostrich industry and create jobs.
       The Tribunal is hearing evidence from various witnesses this week including the two companies, competitors/farmers, retailers and economic experts. The matter has been scheduled for hearing this week and final arguments will be heard next Monday, 8 July 2019. 

Johannesburg, Gauteng, SA – Chemical company Lanxess, one of the major suppliers globally of chrome used in tanning, told S&V last week that the strike at its Rustenburg chrome mine had ended on June 27 and that production is expected to resume this week.
       It said it "did not expect that the strike would result in a shortage of supply, in South Africa or internationally."

Oudtshoorn (SA) – SA - European Union concerns over the monitoring of residues in South African meat exports - specifically ostrich, crocodile and venison - may lead to a complete ban on the export of SA meat to the EU, according to an article in the Oudtshoorn Courant on Friday.
       It said a ban would also apply to partially cooked meat - which the ostrich industry has been developing to circumvent the ban on raw ostrich meat caused by Avian Influenza.
       A ban would also affect the venison industry, which has been waiting for the EU to lift a 7-year ban imposed because of an outbreak of foot-and-mouth disease (FMD).
       The EU has just released a report by a team which visited in February last year to inspect the residue monitoring programme run by the Department of Agriculture, Forestry & Fisheries (DAFF), which checks for the presence of growth stimulants, antibiotics, pesticides and herbicides in game and ostrich meat.
       The Courant said the EU's audit report indicated that the planning, testing and follow-up procedures in DAFF's programme were largely adequate, but that there were shortcomings in the system which put the results in doubt.
       The shortcomings included the use of unsuitable analytical models, the failure to get all samples tested in time, and the failure to test for certain substances.
       Restrictions on meat exports impact significantly on ostrich and game leather, less so on crocodile.