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Consumers yet to feel full impact of drought - economist

Feb 19 2016 14:35
Jenna Etheridge, News24

Cape Town – South Africans have not yet felt the full impact of the drought on their pockets, a Grain SA economist told Parliament’s Portfolio Committee on Agriculture, Forestry and Fisheries on Friday.

Wandile Sihlobo said the white maize spot price for this week has risen by 80% year-on-year and that of yellow maize by 45%.

Increases on raw commodity products have not yet fully filtered through to the consumer.

“For now, people have been living in a good way compared to the situation on the raw commodity side. In a month or so, people will start to react.”

Sihlobo disclosed that the country would have to import about 7.3 million tons of grain to April 2017, based on preliminary estimates.

Of this, maize made up 3.8 million tons, wheat 2 million tons and rice 900 000 tons.

Grain SA CEO Jannie de Villiers said it is important to make sure the country has surpluses.

“The gap between having a shortage and surplus is 75% [difference] in food prices, so we can’t afford it as a country to have a shortage of maize.”

Low food prices increase stability in the country.

“We remember the Arab Spring. Somebody asked me if we are heading for the Rainbow Spring down here in South Africa. We can overcome the drought together and take the industry forward. The farmers are very positive that we can do that,” said De Villiers.

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food  |  sa economy  |  agribusiness  |  drought

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