SOUTH AFRICA – Oilseed production in South Africa is forecast to reach a historic high of 3.6 million metric tons with a planted area of 1.8 million hectares in the marketing year 2023/24, according to the US Department of Agriculture (USDA).
As a result, Post forecasts that South Africa’s oilseed export will reach a record high of 800,000 MT in MY 2023/24 on higher production, 14% more than the estimated 700,000 MT in MY 2022/23.
Post noted that the increasing production follows an upward trend in oilseed that the country has experienced for over 20 years.
Soybean production is projected to reach 2.76 million tonnes from 1.18 million hectares planted, while the sunflower seed harvest could reach 810,000 tonnes from 600,000 hectares.
The country is expected to ship 750,000 tonnes of soybeans and 50,000 tonnes of sunflower seeds overseas.
According to USDA, South Africa expanded its soybean area by almost 9-fold during the past 20 years driven by farmers’ growing interest in using soybeans as a rotational crop with corn and a growing local demand for soybeans through extensive investments in oilseed processing plants.
In addition, higher-yielding cultivars were introduced by seed companies after a statutory seed levy was introduced. The seed levy is payable to the South African Cultivar and Technology Agency (SACTA) on an annual basis
In Soth Africa, the bulk of soybeans and sunflower seeds produced in South Africa are crushed to produce both edible oils for human consumption and protein meal for inclusion in animal feed rations.
The FAS forecasts that South Africa will have a record of 1.7 million tonnes of locally produced oilseed meal available in 2023-24 and 2022-23 after crushing 2.5 million of oilseeds, in line with higher local oilseed production.
However, Post predicts that challenges due to continuing and unprecedented power outages, high utility costs, inflation, and rising interest rates will limit investment in new capacity for its oilseeds processing sector.
Soybean oil imports are expected to increase to 50,000 MT in MY 2023/24 while sunflower oil imports are expected to stay flat.
USDA reports that soybean meal has grown to be the most important protein used by feed manufacturers in South Africa and represents more than 75 percent of protein meal usage in animal feed.
Utilization of soybean meal expanded from approximately 550,000 MT, 20 years ago, to 1.4 MMT in MY 2022/23. Soybean meal is followed by sunflower meal, and together these two commodities represent more than 95 percent of protein usage by feed manufacturers in South Africa
Post projects a marginal growth in the feed consumption of soybean and sunflower meal in MY 2023/24 over MY 2021/22 to 1.8 MMT
However, the USDA states that the current power and infrastructure challenges are expected to hamper growth in the poultry and livestock sectors, which, will lead to a stagnation in demand for animal feed.