A strategic grain reserve usually involves the government buying crops and taking responsibility for their storage until they are needed to make up for shortfalls. "Yes, we are thinking about it," Agriculture Minister Senzeni Zokwana told Reuters late on Tuesday when asked if a grain reserve was being considered. "It is one of the things that the inter-ministerial committee on drought should look at," he said, referring to a cabinet committee set up in 2015 to look at ways of mitigating the drought.
Zokwana did not go into specifics, such as budget allocations for such a project, which would be difficult in South Africa's strained fiscal environment after damaging ratings downgrades. In major global grain producer Russia, which has a strategic grain stockpile, budget cuts caused by the financial crisis in recent years have made it difficult for the agriculture ministry to build up the reserve and to service the storage of the current stock.
South Africa will likely reap 14.54 million tonnes of maize in 2017, almost double last year's harvest and its second largest ever after good rains returned, the government's Crop Estimates Committee (CEC) said on Tuesday. This is more than 40 percent more than the roughly 10.5 million tonnes South Africa typically consumes of the crop, the staple of lower-income households which are a key political base for the ruling ANC and were hard hit last year by rising food prices and inflation linked to the drought. But the El Nino weather pattern, which faded in May of 2016, may reform again around September, just ahead of South Africa's maize planting season, according to a number of national and global forecasts.
Copyright Reuters, 2017