With hopes of a sharp rebound from the pandemic-induced recession quickly fading, policymakers should pause and take stock of what it will take to achieve a sustained recovery. The most urgent policy priorities have been obvious since the beginning, but they will require hard choices and a show of political will. The post-pandemic economy is likely to be anemic, not just in countries that have failed to manage the pandemic (namely, the United States), but even in those that have acquitted themselves well. The International Monetary Fund projects that by the end of 2021, the global economy will be barely larger than it was at the end of 2019, and that the US and European economies will still be about 4% smaller. Read more in the linked article, written for and first published on Project Syndicate.

After experiencing four consecutive quarters of contraction because of droughts and foot-and-mouth disease amongst other factors, South Africa's agriculture economy rebounded in the first quarter of 2020 by 27.8% q/q on a seasonally-adjusted and annualised basis. We expect the following quarters of the year to show solid growth, and the year to average at about 10% y/y (compared to -6.9% y/y in 2019). This will be underpinned by a recovery in all major subsectors of agriculture; namely livestock, field crops and horticulture production. This is all on the back of favourable weather conditions during the 2019/20 production season. Agbiz chief economist Wandile Sihlobo discusses the latest data in the linked article.

The Nampo Harvest Day, which has been bringing agriculture together for almost six decades, has sadly for the first time had to be cancelled by organisers Grain SA, due to the Covid-19 pandemic. The show was postponed to August 2020 at the outbreak of the pandemic, but following the announcement of an unspecified ban on the prohibition of large gatherings, the 2020 Nampo Harvest Day at Nampo Park will now not take place.  However, farmers will still be able to enjoy the best that agriculture has to offer. The 2020 Nampo Harvest Day show, which will be the 54th edition of this iconic agricultural tradeshow, will go online. Please click here to read more.

The high-frequency data on both domestic and global markets reinforced our view that grain prices could be under pressure this year and that this, in turn, could lead to subdued food price inflation.  This past week, the International Grains Council (IGC) lifted its estimate for 2020/21 global maize production from the last monthly estimate to 1.2 billion tons, which is the largest harvest on record, and up 5% from the previous season.  The downward swing in global maize prices saw a 21% y/y decline by 25 June 2020, with prices trading around $162 per ton. Low global maize prices are probably going to remain the theme for the rest of the year. Agbiz chief economist Wandile Sihlobo discusses this subject in the linked article, written for and first published on Fin 24.