South Africa Grain Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

South Africa Grain Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The South Africa grain market is projected to register a CAGR of 5.9% during the forecast period (2021-2026). The production of grains in South Africa was not affected severely by the onset of the COVID-19 pandemic owing to the listing of grains under essential commodities. The trade movements were impacted shortly due to the restrictions, which were restored shortly. Grains contribute significantly to the agricultural sector in South Africa. Maize is the most prominent field crop in the country. The production of maize has increased from 7,778,500 metric ton in 2016 to 11,275,500 metric ton in 2019. The change in consumer behavior towards domestically grown foods coupled with the increased demand for food security has improved the demand for grains in the country. The growth in regional trade, technology, and mechanization advancement in this sector are some of the factors driving the market's growth in the country. Affirmative government policies along with trade policies have impacted the grains market in South Africa.

Key Market TrendsHigh Regional Trade of Grains is Driving the Market

South Africa is one of the major exporters of corn in Africa. Barley, sorghum, and rice are some of the other major grain crops grown in the country. White and yellow corn are the two major grown corn varieties in the country. According to the International Trade Centre Statistics, in 2018, the total exports of maize from the country were 2.2 million metric ton, compared to 1.0 million metric ton in 2016. Botswana, Nambia, Mozambique, and Eswatini are some of the major importers of South African corn. The open free trade agreements made by the South African government with other African countries are promoting the growth of grains in the region. The government is also making agreements, such as The Economic Partnership Agreement (EPA) with the European countries, to expand its presence across other regions. Recently, the United States grains council sent a team to South Africa for analysing the conditions for the production of grains like corn in the country. Through the USDA's Agriculture Trade Promotion Program has employed funds to launch a broader, two-year engagement to expand opportunities for its exporters.

Adoption of Advanced Technologies in Agriculture to improve productivity

The demand for various agricultural products, which incldues grains in the country is increasing owing to higher demand for food security. To address this increasing demand, South Africa is moving towards advanced agriculture model. The country is increasing its investments in the agricultural inputs market. Significant investments are being made by the farmers in the agricultural machinery and agrochemical sector of the economy. Such type of productive investments by the farmers in the agricultural inputs market is estimated to drive the agriculture sector.​ As farmers are increasing investments in the inputs market, private agricultural input companies are investing heavily in R&D, to develop advanced technologies. In terms of mechanization, the studies undertaken by FAO also revealed that the level of mechanization in the South Africa is slowly moving from hand driven technology to power sources. Therefore, the mechanization can, directly and indirectly, bridge the yield gap, by reducing the harvest and the post-harvest losses, thereby driving the market growth for grains in the region. Increased usage of new farm inputs has enhanced the yield from crops, even though the harvested area has been reduced over the years

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Companies Mentioned

IBM Corporation
Oracle Corporation
Internap Corporation
Packet Inc. (An Equinix Inc. Company)
Scaleway Inc.
Amazon Web Services Inc
Rackspace Inc.
CenturyLink, Inc.
LightEdge Solutions, Inc

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