Namibia: High Costs Reduce Local Wheat Production

High production costs and unfavourable climatic conditions during the last few years have caused domestic wheat production to decline significantly. The cereal recorded its least local production during 2019/2020, with 4 466 tons of wheat produced for the entire year.

During 2020/2021, local production accounted for 37% of total demand and the rest (63%), was imported at a value of over N$64 million. The biggest production of local wheat occurred between October 2020 to January 2021.

According to research entity, High Economic Intelligence (HEI), the country's constant shortage of wheat has led to an increase in domestic prices by 15% during the 2020/2021 marketing season. The domestic price escalation was also attributed to an increase in global wheat prices and the supply chain disruptions caused by Covid-19.

In HEI's recently released wheat grain report, it is anticipated that the local production will remain subdued for May and June 2021 due to the fact that wheat is cultivated in winter.

"The production of wheat will increase during the fourth quarter of 2021 into the first quarter of 2022 as a result of good rains. The importation of wheat from South Africa in the coming months will be affected due to supply chain disruptions as a result of the social unrest that occurred in that country in the past weeks," reads the report.

The HEI report recommends thatlocal producers take complete advantage of the marketing schemes implemented by the Namibian Agronomic Board (NAB) to successfully market their crops.

In order to boost the local production of wheat, investment is needed in improved seeds, fertilisers, water availability and training. The report further stated the importance of commercial and development banks to provide crop producers with tailor-made financing. This, said HEI, will furthermore enable farmers to be more competitive in the context of the new dawn regarding the African Continental Free Trade Area (AfCFTA).

From 2010 until 2021, Namibia imported more than 1 million tons of wheat while a total of 112 020 tons was produced locally during this period. The largest production of wheat was recorded during the 2012/2013 period at 14 819 tons.

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