Modelling the wheat sector in South Africa

Abstract

In this study, the structure of the South African wheat market is analysed using economic theory and econometric modelling techniques. The model is used to make baseline projections regarding the supply and use of wheat in South Africa and to analyse the impacts of various policy alternatives on the wheat sector for the period 2004–2008. Results indicate that the area harvested in the summer as well as winter region will decrease over time. Domestic consumption will marginally increase over time, which will result in higher levels of imports. The ability of the model to simulate policy shocks is illustrated by means of simulating the impact of the elimination of the wheat import tariff on the wheat sector.