Food, Agriculture and Natural Resources Policy Analysis Network (FANRPAN) Food, Agriculture and Natural Resources Policy Analysis Network (FANRPAN)

Input Cost Monitor: The Story of Maize and Wheat – An Update
November 2010

Acknowledgements: FANRPAN acknowledges National Agricultural Marketing Council (NAMC) as the source of this document

Since 2002, when exchange rate depreciation resulted in rising prices for most agricultural commodities and inputs, as well as retail food prices, there has been increasing interest in the behaviour of agricultural prices. This, for example, led to the establishment of a Food Price Monitoring Initiative by the National Agricultural Marketing Council (NAMC), and the publication of quarterly reports on changes in food prices. It was also realized, however, that it was important to monitor and disseminate information on changes in agricultural input costs. In August 2006, a workshop was convened with stakeholders in the agricultural sector, at which it emerged that input cost monitoring would be a welcome addition to ongoing research on changes in agricultural-related prices. At this workshop, the NAMC was mandated to coordinate input cost monitoring on behalf of the agricultural industry. The NAMC has since taken up this activity in collaboration with various branches of the agricultural industry. Input cost monitoring, together with food price monitoring, now forms part of two of the NAMC’s key research themes, namely, agro-food chain analysis and market information systems.

Through monitoring input costs, the NAMC aims to be able to publish information on trends in farm input costs on a regular basis. This report provides broad trends in input costs for grains, more specifically in the maize and wheat industries (note that the trends of most input cost items are also applicable to other grains).

In this report, the following issues are reported: (i) broad trends in input cost movements for the grain industry; (ii), the contribution of different variable input costs to the total variable input cost of maize and wheat; and (iii) trends in individual input cost items.

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