Angola BMI View: There have been only minor changes in South West Africa since our last update, including some investment in the Angolan sugar segment . Food security, always of prime concern in the region, is not expected to become problematic in the coming weeks, as planting for the season has begun largely on schedule. A key dynamic to watch will be the price of oil. As most of the region imports oil, high prices coul...
More »
Search ReportLinker
The Largest Collection of Market Research Reports
» 1.2 Million Industry Reports
» 450,000 Company Profiles
» 850,000 Market Briefings
» 40,000 Country Guides
From +200,000 authoritative sources
Angola
BMI View: There have been only minor changes in South West Africa since our last update, including
some investment in the Angolan sugar segment . Food security, always of prime concern in the region, is not
expected to become problematic in the coming weeks, as planting for the season has begun largely on
schedule. A key dynamic to watch will be the price of oil. As most of the region imports oil, high prices
could cause current account deficits, leading to a depreciation of countries' currencies. As countries in
the region are also generally net food importers, a depreciation in currency would most likely lead to
imported food inflation. Indeed, a comparable dynamic occurred in East Africa (specifically Uganda and
Tanzania) in 2011 when energy prices rose. Over the long term, we see only moderate growth in South
West Africa's grain production.
Key Views
.. Zambian corn production growth to 2015/16: 32.6% to 3.7mn tonnes. Government support
and expected high corn prices will most likely lead to a continued rise in corn plantings in the
coming years.
.. Angolan sugar production growth to 2015/16: 68.8% to 84,400 tonnes. This growth is mainly
owing to base effects, as we have not yet seen a significant government commitment to the
agricultural segment and believe that the country will remain a net importer over the long term.
.. 2012 regional average real Gross Domestic Product growth: 7.6 (up from 5.2% in 2011).
.. Average consumer price inflation: 8.2% y-o-y in 2012 (down from 9.0% y-o-y in 2011).
Industry Developments
As of late January, the food security environment in Southern Africa has remained largely stable. There
were generally favourable rains in Namibia and Botswana at the beginning of the 2011/12 cropping
season; however, we note that roughly 240,000 Namibians will continue to suffer from at least mild food
insecurity and that food price inflation in Botswana has risen in recent months. In Angola, there has been
some localised flooding in corn-growing areas owing to above-average seasonal rains. We also expect the
country to require more imports during the 2011/12 season owing to weak production in previous
seasons. In Zambia, there have been some delays to planting owing to poor rains in the eastern and central
regions. Overall, however, we do not expect food stability in the region to become a serious problem in
the near term.
The recent US Dollar 650mn investment by Japanese firm Marubeni in the construction of a sugar and ethanol
plant in Angola is likely to boost sugar and ethanol production in the long term. The factory will be built
in the Cunene region in the south of the country and will have an annual production capacity of 400,000
tonnes of sugar and 40mn litres of ethanol. We expect the country to produce 75,000 tonnes of sugar in
2011/12 and to import 165,000 tonnes in order to accommodate demand of 250,000 tonnes.
Marubeni's
factory would provide a significant boost to domestic production and, if used at full capacity, could make
the country fully self-sufficient. Moreover, we see the government's effort to increase private investment
in the sugar segment as positive for the diversification of the economy away from oil exploration. Currently
44.2% of Angolan Gross Domestic Product comes from mining and oil exploration. The government announced recently
that it would invest US Dollar 6bn in the agricultural segment in order to increase its competitiveness and to
reduce dependence on the oil segment . In addition, the government's plan to increase sugar cane planting to
500,000 hectares by the end of our projection period in 2016 should support ethanol production.
Zimbabwe
BMI View: We are confident of a strong corn crop in 2011/12, thanks to fundamentally sound growing
conditions, despite reports of issues with fertiliser supply in January. This will spur Zimbabwean corn
supply to outstrip consumption and keep it on a healthy incremental path amid sustained government and
private investment. The sugar segment is seeing increased investment from the government and the private
sector, and an area of promise, aside from strong domestic demand, is ethanol for biofuels, of which the
government is seeking a contribution of 10% to its liquid fuel consumption by 2017.
Key Views
.. Sugar consumption growth to 2016: 97.1% to 408,000 tonnes. The defining factors of this
seemingly explosive growth will be base effects and economic growth.
.. Corn production growth to 2015/16: 85.0% to 1.9mn tonnes. This will be driven by greater
availability of fertiliser and higher prices allowing farmers to purchase more seed.
.. 2012 real Gross Domestic Product growth: 7.8% (down from 9.0% in 2011; predicted to average 7.5% from 2011
until 2016).
.. Consumer price inflation: 6.1% y-o-y in 2012 (up from 3.5% y-o-y in 2011).
Industry Developments
After a strong 2010/11 season, when corn production rose by 40% to almost 1mn tonnes, the 2011/12
crop is projection to grow further. The country received adequate rains in Q411 amid the beginning of the
rainy season in November (despite occasional dry spells in parts of Mashonaland West and Central
causing slight and localised dips in output), with above average rainfall expected throughout Q112.
Yet
while greater availability of fertiliser encouraged more plantings in Q411, reports in late January of
shortages of ammonium nitrate top-dressing prompted one government official to highlight the negative
impact this may have on the year's crop. But for now we will stick to our positive outlook for the 2011/12
crop.
The country is seeking to fulfill at least 10% of its liquid fuel requirements with biofuels by 2017. A new
biofuels policy proposal submitted for approval in late 2011 is intended to promote biofuel consumption
(via removal of carbon tax on ethanol) and see that farmers benefit from the whole value chain, ultimately
boosting production. So far two private industry players and the Agricultural Rural and Development Authority
(ARDA) have reached an agreement to use an estimated 5,500 hectares (ha) of sugarcane in the country's
main growing region (the lowveld) for ethanol production, with a further 11,000 ha scheduled for January
2012. As part of the agreement, ARDA will provide land to the private firms, who will build the facilities
and then sell it back to ARDA after 20 years. Output from the project is expected to reach roughly
350,000 litres of anhydrous (up to 85%) ethanol a day, enabling the plant to meet the country's ethanol
requirements by 2020.
Energy & Environment Industry in Namibia
Executive Summary .. 5
Angola 5
Zimbabwe . 6
Industry SWOT Analysis . 8
South West Africa Agricultural SWOT . 8
Zimbabwe Agricultural SWOT . 9
Supply Demand Analysis 10
South West Africa Grains Outlook - Zambia . 10
Data : Angola, Bostwana, Namibia, Zambia Corn Production & Consumption .. 11
Data : Angola, Botswana, Namibia, Zambia Corn Production & Consumption .. 16
South West Africa Sugar Outlook - Angola 17
Data : Zambia, Angola Sugar Production & Consumption 18
Data : Zambia, Angola Sugar Production & Consumption 23
Zimbabwe Grains Outlook . 24
Data : Zimbabwe's Corn Production And Consumption, from 2011 to 2016 ('000 tonnes) 25
Data : Zimbabwe's Corn Production And Consumption, from 2007 to 2012 ('000 tonnes) 28
Zimbabwe Sugar Outlook 29
Zimbabwe's Sugar Production And Consumption, from 2011 to 2016 ('000 tonnes) . 29
Data : Zimbabwe's Sugar Production And Consumption, from 2007 to 2012 ('000 tonnes) .. 34
Commodity Price Analysis . 35
Monthly Softs Update 35
Cocoa. 35
Coffee. 36
Palm Oil .. 37
Sugar . 38
Monthly Grains Update .. 39
Corn: Topped Out 39
Rice: Ample Supply . 40
Soybean: Supply Risks .. 41
Wheat: Regaining Poise 42
Downstream Analysis 43
Zambia . 43
Copper, Crops, Consumer And Government To Underpin Growth . 43
Data : Zambia - Fiscal Policy .. 45
Angola . 46
Data : Angola - Economic Activity . 50
Botswana 50
Data : Coal Deposits . 52
Data : Botswana - Gross Domestic Product By Expenditure, Us$ Terms Breakdown 54
Namibia .. 55
Industry Business Environment Overview .. 58
SSA Food & Drink Ratings: Region's Reward And Risk Profile Poles Apart . 58
Industry Trend Analysis .. 62
World Food & Drink View .. 65
Food & Drink Q411 Roundup: Core Views 65
Data : Agricultural Commodity Prices . 67
Data : Core Views Q411 .. 76
BMI Projection Modelling 77
How We Generate Our Market Projections 77
