Crop failure caused by drought will have a multibillion-rand impact on the economy through an increased need for crop imports.
Grain SA estimates that South Africa will have to import 770 000 tonnes of maize at R2.2bn until the end of April 2016, although the country typically produces a 2 million tonne maize surplus. South Africa will also need to import R1bn worth of wheat to make up for shortfalls due to drought conditions.
Despite the local shortfall, SA has committed to exporting 630,000 tonnes of maize to Botswana, Lesotho, Namibia, Swaziland and Zimbabwe. All of the above will see South Africa’s economy taking a R9.2bn knock, excluding the drought’s financial impact on farmers’ income, job losses and inflation.