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Despite Good Harvest, El Nino Lurking in South Africa's Future

Wheat farmers in the Western Cape are concerned. After minimal rain over the past several months, soil moisture is low across many fields and to make matters worse, weather models are giving little indication of rainfall within the next two weeks.

The farmers in the region typically start planting their winter wheat crop around mid-April, but this year action in the fields has been limited. During a phone conversation this week one farmer told me: "Soil moisture is low. There hasn't been any meaningful rain."

The El Niño weather pattern, typically associated with hot and dry weather conditions in South Africa may return later this year. In the current uncertain economic climate, any decrease in domestic grain production would negatively affect consumers.

The exchange rate has a strong correlation with wheat prices, which eventually influences prices for products like bread and weetbix. In a normal season, South Africa imports about a half of its annual wheat needs, and lower wheat output means more purchases from overseas producers.

Bioversity International/J.van de Gevel

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