Windhoek-Good rainfall in maize-producing areas in southern Africa and the recent strengthening of the Namibia Dollar will result in some relief in the form of reduced prices for maize meal, mahangu meal, baking flour and rice. Namib Mills shared this news with the public on Friday morning and said the reduced prices will come into effect on Tuesday, February 7, for all its products except sugar.
The price decreases will on average be: Top Score (Maize Meal) -12%, Bakpro (Baking Flour) -6%, Meme Mahangu Meal -6% and Rice King -7%. “Due to the fact that most soft commodities are exposed to the exchange rate, the improvement of the Namibia Dollar against the United States Dollar (US$) has made these products’ raw material more affordable,” explained Ian Collard, Chief Executive Officer at Namib Mills.
Collard cautioned that Namibia is still exposed to the current volatile pricing on SAFEX, the commodity exchange in South Africa. However after maize prices skyrocketed in 2016, following prolonged drought, improved rainfall across the region has boosted sentiment for a high maize crop in 2017, thus the “supply and demand” factor is better balanced, resulting in lower raw maize prices. Current levels for white maize ex-Randfontein in South Africa are around N$3 500 per ton, compared to N$5 000 a short while ago.
“Wheat prices are currently quite inexpensive, the reasons being that Eastern Europe and Russia have been coming on stream the past few years regarding consistent wheat supply. This along with very competitive shipping rates, due to the downturn in the world economy, made wheat rather cheap in historical terms,” said Collard.
In terms of mahangu, the local drought in the country during 2015/16 resulted in a very small harvest, which necessitated imports from abroad. However, a scarcity of mahangu persists as the only excess mahangu-producing country worldwide is India.
The prices of rice, which is imported from India, also decreased due to the strengthening currency. Sugar prices however remain the same as Namibia cannot benefit from decreased international landed prices as South Africa has not reduced import duties, as prescribed in the sugar duty formula of the Southern African Customs Union (SACU).
“Taking all this into account, Namib Mills would like to ensure our consumers that we are committed to them and will maintain our good quality standards and service levels as well as strive to ensure consistent availability of these basic foodstuffs. As a corporate citizen, Namib Mills is committed to Namibia. The company highly values its customers, suppliers, and all other stakeholders. It is important to Namib Mills to not only focus on great quality, excellent customer service and meeting consumer needs, but also to live in accordance with our values of being transparent with our customers and consumers,” said Collard.