Executive Summary:

Post forecasts that the corn area planted in late 2011 for the marketing year that will start May 2012 and end April 2013 (split year 2011/12 in the PS&D table) will be around 3.1 million hectares. This will, on a national average yield, result in a crop of about 12.7 million tons, 14 per cent more than the previous season. This should put South Africa in a position to export about two million tons.

The Crop Estimates Committee’s (CEC) final estimate for the 2011/12 MY corn crop is 11.172 million tons. This is two per cent lower than post’s July estimate of 11.419 million tons due to the impact of flooding that occurred in producing areas during harvest time. With the current crop of more than 11 million tons and carry-over stocks of approximately five million tons, South Africa has excess corn available to supply the global market.

Hence, for the first six and a half months of the 2011/12 MY (May 1, 2011 to October 15, 2011), South Africa already exported 1.575 million tons (929,709 tons of white corn and 645,675 tons of yellow corn). If exports continue at this pace, South Africa should be able to export almost three million tons. So far, Mexico has emerged as South Africa’s major market with 608,456 tons of white corn imports. South Africa also exported 19,442 tons of white corn to the drought affected Somalia.

Corn

Post forecasts that the corn area planted in late 2011 for the marketing year that will start May 2012 and end April 2013 (split year 2011/12 in the PS&D table) will be around 3.1 million hectares. Commercial farmers will plant about 2.6 million hectares on the back of a sharp increase in corn prices and subsistence farmers 500,000 hectares. This will, on a national average yield, result in a crop of about 12.7 million tons, 14 per cent more than the previous season. This forecast is in line with the “intention to plant survey” that was published by the CEC on October 25, 2011. According to the commercial farmers indicated that they will plant 2.602 million hectares. The intention by commercial farmers is to plant 1.564 million hectares of white corn and 1.038 million hectares of yellow corn.

The final estimate for the area planted and production of corn by commercial farmers for the 2011/12 MY (May 2011 to April 2012 and split year 2010/11 in the PS&D table) was released by the CEC on September 27, 2011. According to the CEC, commercial farmers planted 2.372 million hectares. This is 13 per cent less than the corn hectares planted in the 2010/11 MY. The CEC estimates that subsistence farmers planted about 486,760 hectares, marginally less than the previous season. Commercial farmers planted 1.418 million hectares with white corn, 18 per cent less than the previous year, and 954,000 hectares with yellow corn, seven per cent less than the previous year. Plantings were down in response to South Africa’s four million ton corn surplus that developed after three excellent crop years in a row.

The CEC’s final estimate for the 2011/12 MY commercial crop is at 10.608 million tons. This is 17 per cent less than the previous year’s crop of 12.815 million tons due to lower plantings. White corn is estimated at 6.182 million tons, 21 per cent less than the previous season, while yellow corn is estimated at 4.426 million tons, 11 per cent less than the previous year. Furthermore, the CEC estimates that subsistence farmers produced 564,335 tons, which brings South Africa’s total estimated crop for the 2011/12 MY at 11.172 million tons. This is two per cent lower than post’s July estimate of 11.419 million tons due to the impact of flooding that occurred in producing areas during harvest time.

The following table details area planted and production figures of white and yellow commercial and subsistence corn for the 2010/11 (actual), 2011/12 (estimate) and 2012/13 (forecast) marketing years.

Table 1: Area planted and production of commercial and subsistence corn in South Africa

Consumption

For the 2012/13 MY, Post forecasts that the trend of the previous season will continue with corn for human consumption to remain basically flat, while the demand for corn for animal feed purposes will increase by two per cent to 4.56 million tons. As a result, the total domestic demand for corn will increase to 10.060 million tons in the 2012/13 MY.

Total commercial consumption for the 2011/12 MY is estimated to be around 9.82 million tons, almost two per cent more than the 9.652 million tons consumed in the 2010/11 MY. Corn for human consumption (mainly white corn) is expected to remain flat at 4.55 million tons due to higher prices, while corn for feed purposes (mainly yellow corn) is expected to increase by four per cent to 4.47 million tons. As general economic conditions improve, middle-income consumers will consume more meat which will increase the demand for corn as the major animal feedstock.

The following table outlines the commercial consumption for white and yellow corn for the 2010/11 (estimate), 2011/12 (estimate) and 2012/13 (forecast) marketing years. Please note that consumption figures in the PS&D table also include corn utilized by the subsistence farming sectors.

Table 2: The commercial consumption of white and yellow corn in South Africa

Trade

In 2011, corn became South Africa’s number one agricultural export product, surpassing citrus, wine, table grapes and apples. Between January 2011 and August 2011, South Africa exported 1.83 million tons of corn earning US$540 million in foreign exchange.

For the first six and a half months of the 2011/12 MY (May 1, 2011 to October 15, 2011), South Africa exported 1.575 million tons (929,709 tons of white corn and 645,675 tons of yellow corn) (see also Table 3). If exports continue at this pace, South Africa will be able to export almost three million tons in the 2011/12 MY. With carry-over stocks of approximately five million tons and a current crop of more than 11 million tons, South Africa has excess corn available to supply the global market. So far in the 2011/12 MY, Mexico has emerged as South Africa’s major market with 608,456 tons of white corn imports. Mexico is followed by Korea with 304,660 tons of yellow corn and 38,783 tons of white corn. Taiwan is currently South Africa’s third biggest market and imported 161,550 tons of yellow corn. South Africa also exported 19,442 tons of white corn to the drought affected Somalia.

With a smaller beginning stock and an estimated crop of 12.7 million tons , South Africa’s corn exports should normalized in the 2012/13 MY to about two million tons.