Namib Mills lowers food prices
Namibian consumers can look forward to some relief amidst reports of soaring inflation and government budget cuts.
Next week Namib Mills will announce a price decrease effective in February on its products. This is the first price decrease in more than a year.
While the company would not elaborate on further details, a full announcement is expected on next week Friday.
Experts speculate that the cost of grain products will drop due to healthy harvest predictions.
According to Dawie de Klerk, chairperson of the Agronomic Producers' Association, Namibia is estimated at this early stage to produce a third of its own maize requirements, roughly 46 000 tons, this year.
“Maize prices are surprisingly stable for this time of the year, especially taking into account the latest harvest estimates in South Africa,” said De Klerk.
According to him crop farmers are very positive about the rains. “We really need it to rebuild the industry after last year's poor harvest.”
Namibians last year suffered hefty food price increases that were way above the official inflation rate.
In August, Namib Mills spokesperson Ashante Mannetti told Namibian Sun that the prolonged drought of the past few years had put significant pressure on the affordability of grains as maize and wheat are traded on the free market, which is driven by demand and supply. “In cases where supply decreases, prices will go up, but should demand decrease, the price should come down. Recent droughts have had the effect that food inflation increased faster than the average inflation,” she said at that stage.
By August last year the price of Namib Mills' Top Score maize meal had increased by 16%, mainly because of the drought, while wheat products such as bread and pasta had increased by 14%.
Manetti explained that the high wheat price was also partly due to drought, but mainly because of a weaker Namibian dollar.
“The whole Southern African region is a net importer of wheat, as wheat is more effectively grown in colder climates such as Canada, Germany and Russia.”
She said the most important factor to keep an eye on was rainfall in the maize-producing areas of Namibia and South Africa. Market prices are starting to drop as weather forecasters are predicting normal rainfall for the 2016/2017 season.
De Klerk said Namibia's dry-land maize harvest was expected to reach 46 000 tons this season.
The country's maize consumption over the past three years was about 155 000 tons per year.
Going into more detail about the expected harvest, De Klerk said the Maize Triangle and the Otavi Valley were still very dry up to the end of December.
During the past two weeks farmers have been planting. But, because of financial pressure resulting from last year's poor harvest, not all farmers in these areas could afford to plant all their fields.
About 5 000 hectares of maize will be planted this year, De Klerk said.
Should there be sufficient follow-up rains the harvest could average three tons per hectare, otherwise it will be about 2.5 tons per hectare. That means a harvest of between 12 500 and 15 000 tons, explained De Klerk.
“The possibility of a record harvest is therefore not excluded.”
He said in the east of the country farmers were still planting. Indications were that about 2 600 hectares of maize would be planted on dry land and 1 500 hectares under irrigation.
“If the rain continues it will result in about 7 000 tons of maize.”
In the Hardap Region only 700 hectares of maize were planted and the expected harvest is 7 000 tons. He said the reason for this was because large areas were planted with lucerne during the drought.
With regard to the Green Schemes, De Klerk said planting started late and maize was still being planted. The schemes usually plant about 2 800 hectares under irrigation and 900 hectares on dry land. That means an estimated harvest of between 15 000 and 17 000 tons can be expected there.
ELLANIE SMIT
Next week Namib Mills will announce a price decrease effective in February on its products. This is the first price decrease in more than a year.
While the company would not elaborate on further details, a full announcement is expected on next week Friday.
Experts speculate that the cost of grain products will drop due to healthy harvest predictions.
According to Dawie de Klerk, chairperson of the Agronomic Producers' Association, Namibia is estimated at this early stage to produce a third of its own maize requirements, roughly 46 000 tons, this year.
“Maize prices are surprisingly stable for this time of the year, especially taking into account the latest harvest estimates in South Africa,” said De Klerk.
According to him crop farmers are very positive about the rains. “We really need it to rebuild the industry after last year's poor harvest.”
Namibians last year suffered hefty food price increases that were way above the official inflation rate.
In August, Namib Mills spokesperson Ashante Mannetti told Namibian Sun that the prolonged drought of the past few years had put significant pressure on the affordability of grains as maize and wheat are traded on the free market, which is driven by demand and supply. “In cases where supply decreases, prices will go up, but should demand decrease, the price should come down. Recent droughts have had the effect that food inflation increased faster than the average inflation,” she said at that stage.
By August last year the price of Namib Mills' Top Score maize meal had increased by 16%, mainly because of the drought, while wheat products such as bread and pasta had increased by 14%.
Manetti explained that the high wheat price was also partly due to drought, but mainly because of a weaker Namibian dollar.
“The whole Southern African region is a net importer of wheat, as wheat is more effectively grown in colder climates such as Canada, Germany and Russia.”
She said the most important factor to keep an eye on was rainfall in the maize-producing areas of Namibia and South Africa. Market prices are starting to drop as weather forecasters are predicting normal rainfall for the 2016/2017 season.
De Klerk said Namibia's dry-land maize harvest was expected to reach 46 000 tons this season.
The country's maize consumption over the past three years was about 155 000 tons per year.
Going into more detail about the expected harvest, De Klerk said the Maize Triangle and the Otavi Valley were still very dry up to the end of December.
During the past two weeks farmers have been planting. But, because of financial pressure resulting from last year's poor harvest, not all farmers in these areas could afford to plant all their fields.
About 5 000 hectares of maize will be planted this year, De Klerk said.
Should there be sufficient follow-up rains the harvest could average three tons per hectare, otherwise it will be about 2.5 tons per hectare. That means a harvest of between 12 500 and 15 000 tons, explained De Klerk.
“The possibility of a record harvest is therefore not excluded.”
He said in the east of the country farmers were still planting. Indications were that about 2 600 hectares of maize would be planted on dry land and 1 500 hectares under irrigation.
“If the rain continues it will result in about 7 000 tons of maize.”
In the Hardap Region only 700 hectares of maize were planted and the expected harvest is 7 000 tons. He said the reason for this was because large areas were planted with lucerne during the drought.
With regard to the Green Schemes, De Klerk said planting started late and maize was still being planted. The schemes usually plant about 2 800 hectares under irrigation and 900 hectares on dry land. That means an estimated harvest of between 15 000 and 17 000 tons can be expected there.
ELLANIE SMIT
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