Standardisation key to insuring SA’s growing grain storage industry in changing risk landscape.
The current tough economic climate, high inflation and escalating risk landscape present challenges for South African grain producers and businesses operating throughout the grain storage value chain.
According to the International Grains Council (IGC), South Africa produces more than 18 million tonnes of grains annually, with nearly three million tonnes being exported. Ensuring a consistent supply of high-quality grains is vital to avoid volatility in price fluctuations.
Source: ©joruba via 123RF
Within the context of this economically constrained and heightened risk environment, I had the opportunity to attend the 2023 Agricultural Business Chamber of South Africa (Agbiz) Grain and Oilseed Value Chain Symposium as a panellist. SA’s growing grain storage industry
Central to the symposium theme Build Certainty, Create Sustainability, the panel discussion unpacked ‘the insurability of the grain storage industry’ and the critical need to regulate and de-risk the grain storage value chain. Doing so would help to avoid losses stemming from the quality of crops such as wheat, corn and sorghum being compromised. This results in reduced trading values in an industry where margins are already squeezed.
Other panellists included Ebbe Rabie, managing director and head of speciality at Price Forbes; Gerard Ramage, SHEQ manager: health and food safety at VBK Group; Zhann Meyer, Africa head: global commodities at Nedbank Corporate Investment Banking; and Letisha van den Berg, director of ASPASA, small service mining association. The robust discussion was facilitated by Kobus Truter, head: structured commodity finance at ABSA Corporate and Investment Bank.
Evolving risk landscape
The volume of grain production in South Africa has had a knock-on effect on the growth of the grain storage industry, and the panellists emphasised the risks attached to the development of non-commercial storage facilities.