WANDILE SIHLOBO: Better harvest bodes well for moderating food inflation

Grain production recovery remains one of the key themes for SA agriculture this year. After an excellent summer grains and oilseed harvest for the 2024-25 season, estimated at 19.55-million tonnes (up 26% year on year), SA also appears poised to have a decent winter crop harvest.

Prospects for the winter appeared uncertain in the early parts of the season. At the start of the 2025-26 winter crop season, we were concerned that what looked like unfavourable rainfall prospects, with higher input costs, would discourage planting.

Fortunately for many winter crop-producing regions of the Western Cape, the climatic conditions turned out better than expected, delivering favourable rainfall that supported better plantings and continued to present conducive growing conditions for the crops.

In other SA winter crop-growing regions the longer-than-usual summer rainfall period improved soil moisture and dam levels, all of which are beneficial to winter crops, especially in irrigation regions. There are sufficient water supplies to support the crop throughout the season. 

Farmers pushed through and planted a decent area of 841,685ha, up 3% from the previous season, according to data from the crop estimates committee (CEC). This comprises wheat, barley, canola, oats and sweet lupins. We observed an increase in plantings of most of these crops, except for barley, which declined slightly.

But the optimism does not end with an increase in area plantings. The yield potential is also promising. The CEC forecasts SA’s 2025-26 winter crop harvest at 2.79-million tonnes, up 5% from the previous season. Production is expected to increase for most crops, except for barley, for which the challenge is that farmers have shifted the area to other crops, partly due to profitability reasons.

The 2025-26 wheat production is estimated at 2.04-million tonnes, a 6% increase on the previous season due to a slight increase in plantings and better expected yields. Most provinces are showing an improvement, with the Western Cape being the major producer, followed by the Northern Cape, Free State and Limpopo.

If the forecast crop materialises we could see a mild decline in import requirements in the 2025-26 marketing year. Already, the SA supply & demand estimates committee forecasts 2025-26 wheat imports at 1.74-million tonnes, 3% down from the previous season.

The canola crop is projected to reach a new high of 320,043 tonnes, up 10% from the previous season. This is also boosted by an increase in plantings and expected better yields. This harvest prospect reinforces SA’s position as a relatively new exporter of canola products. The country is now a net exporter of canola, having recently exported to countries such as Germany and Belgium.

The 2025-26 oat production is forecast at 57,213 tonnes (up 32% year on year), with production of sweet lupins at 23,100 tonnes (up 20% year on year). On the downside, the 2025-26 barley harvest is estimated at 352,675 tonnes, down 55% from the previous season.

All things considered, the 2025-26 winter crop season appears set to be somewhat better than last season. Yet farmers’ profitability remains under pressure due to higher input costs at the start of the season, and that in some Western Cape regions farmers had to replant their canola fields because of snail infestations, further increasing costs.

From a consumer perspective, the better harvest and generally low global grain prices bode well for a moderating path of food price inflation. We are still early in the season and this is our first production estimate, but overall the outlook for the season looks promising. 

• Sihlobo is chief economist at the Agricultural Business Chamber of SA and a senior fellow in Stellenbosch University’s department of agricultural economics.