Location differentials for maize announced 25 March 2014

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Grain SA took note of the announcement by the JSE on 25 March 2014 regarding the location differentials for maize. Despite the fact that Grain SA does not support the location differential, we aim to keep it as low as possible.

 The average increase in the differential is 9.8%. This follows a very intensive meeting between Grain SA and the JSE on 17 March 2014. "The spirit at this meeting was very good and the JSE was very receptive to our inputs," said Jannie de Villiers, CEO of Grain SA.

The initial increase that was published for comments was 12.9%. This increase appeared suspicious following a diesel price increase of 12.3% over the same period. In the meantime Transnet Freight Rail announced their new tariffs for 2014/2015 of which some have even decreased. This is very encouraging!

"It is still a major concern to the grain industry that the percentage transported by rail is still decreasing," said De Villiers. According to SAGIS, Transnet Freight Rail transported only 16% of all the maize in 2013 compared to 80%+ in the 1980's.

It remains a concern of Grain SA that the increase at the various delivery points differs substantially. Some shows no increase, whilst others increased by as much as 20%. This intervention by GSA saved producers more than R100m.

This is the value that Grain SA adds to the businesses of the grain producers in this country.


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