Varied response to Namibia maize export embargo

White maize

from AFRED SHILONGO in Windhoek, Namibia
WINDHOEK, (CAJ News)
THERE are mixed sentiments to the decision by Namibia to provisionally suspend imports of the staple white maize.

Imports of millet are also outlawed.

The suspension is with immediate effect, a development that the administration of President Haige Gottfried Geingob says is aimed at safeguarding local producers from imported products flooding the market.

Local producers of the commodity face stiff competition amid the demand of maize projected to peak at 70 000 tonnes by November.

Namibian farmers are only expected to produce slightly more than 64 000 tonnes of white maize.

Industry regulator, the Namibian Agronomic Board (NAB), recently announced that millers declining maize from local producers would be declined import permits.

The decision by Namibia is seen as aligned to several countries adopting restrictive trade policy approaches such as export bans and export quotas since the coronavirus (COVID-19) pandemic erupted.

Namibia has confirmed 25 cases of the virus (there have been no casualties) since it was first detected in China at the end of last year.

Countries have justified restrictive trade policies as consumer-focused, considering respective countries needed to ensure domestic food security during this pandemic. Namibia is in this bracket.

However, some countries have reversed the restrictions after the International Grains Council data showed ample global grain supplies in the 2019/20 and prospects for a larger crop in the 2020/21 production season.

Economist AndileSihlobo of the Agricultural Business Chamber (Agbiz), an association of agribusinesses in the Southern African region, expressed mixed feelings over Namibia’s stance, justifying the policy as ensuring that domestic farmers have a market for their produce, which would support them during this pandemic.

“But I can’t stop to wonder if this policy is practical if one seriously considers Namibia’s maize market as an example,” the economist said.

He pointed out maize was one of the major staple crops in Namibia, although largely dependent on imports.

Over the past five seasons, Namibia’s maize production averaged 59 000 tonnes, according to data from the United States Department of Agriculture.

This is against average annual maize consumption needs of 216 000 tonnes.

The difference is usually covered by imports, which is a volume the NAB wants to put a temporary halt on.

“The policy appears to be heavily producer focused at the expense of the consumers that could benefit from competitively priced imports,” Sihlobo said nonetheless.

He argued with maize import needs of about 72 percent of Namibia’s annual consumption of the crop, placing a temporary ban on imports is not an informed policy option, especially during the pandemic where the objective of the governments should be to get the most affordable food to the citizens.

“Such affordable food, in the absence of trade barriers, could be a reality this year,” the economist said.

In a related development, as pointed out by analysts, projected declines in the price of maize in South Africa could be advantageous to Namibia. South Africa is a major maize supplier to its northern Namibia.

According to the Crop Estimates Committee, South Africa is expecting about 15,2 million tonnes, which is the second-biggest maize harvest on record.

It is projected South Africa’s maize prices will likely fall to levels below R2 600 (US$725) per tonne for both white and yellow maize as the harvest process gains momentum around mid-June 2020.

Prices are currently hovering around that figure.

“Such potential price declines would be beneficial to the Namibian consumers,” Sihlobo said.

Agbiz estimates that South Africa could have about 2,7 million tonnes of maize for the export market.

This represents a massive increase of 90 percent year-on-year.

– CAJ News

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