South African households may soon feel the pinch as the price of white maize, a staple food, is expected to rise in the first quarter of 2025. This comes after a challenging 2024 maize production season marked by drought, according to the Agricultural Business Chamber (Agbiz).

The South African Cereals and Oilseeds Trade Association (Sacota) on Tuesday pointed out the seriousness of the situation, noting that this week South Africa imported white maize for the first time since 2017.

This as Wandile Sihlobo, Agbiz's chief economist, warns that tighter maize stocks are likely to drive prices higher and become a reality in the first quarter of 2025.

“Relief may start in the second quarter of the year. On January 9, South Africa's white maize spot price traded around R6,724 per tonne, up 55% from the previous year,” he said.

Sihlobo added that the fundamental challenge South Africa faces is that white maize stocks are tight.

“If we continue using about 428 667 tonnes of white maize monthly, the 2024-25 marketing year may end with closing stocks of just 277 884 tonnes by April 30, 2025. To understand how tight such closing stocks are, consider the 2023-24 marketing year: the white maize closing stocks were 1.3 million tonnes, and in the 2022-23 marketing year, they were 1.1 million tonnes,” he said.

The tighter stocks also imply that South Africa must have early deliveries for the 2025-26 marketing year (which corresponds with the 2024-25 production year) starting May 1, 2025.

Sihlobo said:, “Such early deliveries would ease some market participants' concerns about the supplies. The past 2023-24 maize production season (corresponding with the 2024-25 marketing year) was challenging following a mid-summer drought between February and March.”

The impact of last year’s drought is evident. Dr André van der Vyver, executive director of Sacota, said, “With poor crops last year, record exports to Zimbabwe and record high prices, South Africa is currently offloading its first white maize vessel since March 2017,” he said.

During the 2023/24 production year, grains and oilseeds experienced a poor year, with production declining from the previous year by approximately 22.5%.

“In the case of maize, this was a decline of 29.4%, and for soybeans, it was a decline of 33.5%. In November 2024, the final estimate of the Crop Estimates Committee for white maize production was at 6.007 million tons, down by 29.3%, and yellow maize was at 6.716 million tons, down by 15.4%,” he said.

In the South African seasonal crop cycle, these products should last until approximately March/April 2025 before the new crop (that was planted in November and December 2024) becomes available again.

“Looking at the South African demand only, this meant that South Africa had just enough grains to feed itself. However, from a Southern African perspective, during most years South Africa also supplies countries such as Botswana and Namibia with the bulk of their demands, he added,”

Anthony Clark, an independent analyst at Small Talk Daily Research, said that in 2024, due to an El Niño year, dry, hot conditions slammed the commercial maize harvest, which declined from the 2023 level of 16.43 million tonnes to 12.724 million tonnes.

“The harvest was hard hit from climatic conditions, with the yellow maize crop down -15.2% to 6.717 million tonnes, with white maize harder hit, falling -29.4% to 6.007 million tonnes. Drought in SADC and a tighter domestic crop saw elevated prices as significant pull from exports into the region drove prices, especially white maize, Clark said.

Mervyn Abrahams, the Programme Coordinator of the (PMBEJD), said that for many households, maize meal, along with rice and flour, forms the core foods that enable them to get by on a daily basis.

“Maize meal, in particular, is the staple and more affordable item for many families in the country, and any talk of a possible rise in the item raises a legitimate concern. There is every indication that households are battling to feed families owing to wage increases that are not on par with inflation, and other competing costs, especially with the opening of schools and municipality bills, ” Abrahams said.

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