Over the past couple of weeks soybeans hit the headlines in global media, spurred by then rising tensions in US-China trade relations.
Coincidentally, the crop dominated agricultural media headlines here at home as well, but not to the same extent and for different reasons.
South Africans had learned from the national crop estimates committee’s monthly updates that the country’s soybean harvest could reach 1.4-million tonnes in the 2017-18 production season, a record harvest.
Soybean development is one of SA’s agricultural success stories. Its production has grown since 1994, from 67,700 tonnes in the 1993/94 season to more than 1-million tonnes. This was stimulated by growing demand for soybean oilcake or meal by the animal feed industry. This has been driven by an increase in the demand for high protein foods, particularly poultry products.
SA’s per capita consumption of poultry meat has almost doubled over the past 17 years, now estimated at 41kg, according to data from the Department of Agriculture, Forestry and Fisheries.
Underpinning this positive production response was an increase in the area planted, and technological improvements in the form of seeds, fertilisers and better farming practices, among others
To service the growing demand agribusinesses, supported by the government, made investments to increase domestic soybean processing capacity from about 860,000 tonnes in 2012 to a level in excess of 2.2-million tonnes. This was also aimed at stimulating domestic soybean production, as part of an import substitution strategy. Farmers responded positively to these demand changes, as evidenced by the expected record harvest.
Underpinning this positive production response was an increase in the area planted, and technological improvements in the form of seeds, fertilisers and better farming practices, among others. In terms of plantings, the soybean area has increased 14-fold over the past 24 years to 787,200ha in the 2017-18 season. The contribution of the better farming practices and technological advancements is apparent from the improved yields, which increased by almost half from the 1993-94 season to an expected 1.82 tonnes per hectare this season.
One of the most notable technological improvements is the adoption of genetically modified (GM) seeds in the early 2000s. In the 2016-17 season GM seed constituted about 95% of SA’s soybean plantings.
Worth noting is that SA is the only country in Africa that produces GM soybeans. Therefore it is unsurprising that the country continues to enjoy tremendous growth in soybean output, while production in other African countries remains pedestrian.
This success is not unique to SA. The world’s leading soybean producers, among them the US, Argentina, Brazil, Paraguay, Canada and Uruguay, all grow GM soybeans. In fact, about 75% of global soybean production in the 2016-17 season was GM.
Most importantly, the investment in the expansion of SA’s soybean processing capacity and improvements in production techniques, have led to a success story in terms of import substitution of soybeans and oilcake.
The Agricultural Business Chamber estimates that soybean oilcake imports could reach 458,992 tonnes in 2018, down 17% from 2017 and well below the level of close to 1-million tonnes in 2010.
I believe the success of the import-substitution strategy for soybeans needs to be heard, as it contains some lessons for other industries experiencing similar challenges. It’s not every day that a country records such progress in food production.
I foresee further expansion in SA’s soybean production, but this could come at the expense of yellow maize as both crops are grown in the eastern parts of the country. Ultimately, the farmers’ decisions will be informed by the price competitiveness of each crop.
• Sihlobo (@WandileSihlobo) is head of economic and agribusiness research at the Agricultural Business Chamber.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.