BY MTHANDAZO NYONI
THE cost of procuring raw materials for manufacturing stockfeed rocketed by 886% in 2020 after maize prices rose threefold during the period, according to the Stockfeed Manufacturers Association (SMA).
The SMA said in a report released last week that it manufactured and bought stock worth $29,5 billion last year during the period, although operations were affected by logistical problems at border posts and foreign currency shortages.
SMA said it bought 562 382 metric tonnes (mt) of raw stockfeed and produced 554 831 metric tonnes (mt) during the period.
These represented a drop of 10% and 11% compared to 2019 respectively.
“The average cost of procurements of raw materials in 2020 was $23 013/mt, an increase of 886% over 2019 being driven by the threefold increase in the maize price from early 2019 to 2020,” the SMA said.
During a recent meeting, SMA members said logistical problems at border posts and foreign currency shortages were among the major factors affecting raw material supply.
They said the last landed price for maize was US$340 per mt in South Africa and US$320 per mt in Zambia.
Last week’s report said maize bran and molasses were in short supply during the period.
It said the total tonnage of maize and soya bean derivatives procured in 2020 were 256 260mt and 123 290mt respectively.
These represented a decrease of 13% and 18% respectively compared to 2019.
The total values of maize and soya bean derivatives procured during the period was $5,3 billion and $4,1 billion, being changes of about 1 094% (93%) and 596% (-9%) over 2019.
SMA said poultry feeds continued to dominate the stockfeed industry, accounting for 68% of all feeds produced by weight and 75% by monetary value in the fourth quarter of 2020.
Production averaged 37 328mt per month.
The production of broiler and layer feeds were 33% and 22% higher than the fourth quarter of 2019, respectively.
However, poultry concentrates were 23% lower than the fourth quarter of 2019.
Pig feeds averaged 4 321mt per month worth $166 million, accounting for an increase of 8% by both tonnage and value of total feeds produced in the fourth quarter.
Ruminant feeds averaged 10 720mt per month worth $266 million, accounting for increases of 20% by tonnage and 13% by value of total feeds.
On average, prices of raw materials procured in the fourth quarter of 2020 increased by 13%.
Notable increases were low protein cottonseed meal, screenings and coarse limestone flour.
Indexed to the United States dollar, procurement prices increased by 9% and prices of maize and solvent extracted soya meal averaged US$262 and US$438/mt, being increases of 10% and 3% on average during the third quarter.
Fourth quarter prices of feeds increased by 3%, SMA said.
Average weighted wholesale prices of broiler and layer feeds rose by 4% and 10%, respectively, to $45 120 per mt and $35 600 per mt respectively.