Zambia Agribusiness Report Q2 2016
BMI View: We project stable but limited growth for the Zambian agricultural sector over the next fiveyears, as the country will remain a prime supplier of corn and sugar to the South West Africa region.
Continued kwacha weakness will translate into a higher cost of imported inputs, thereby reducing fertiliseruse across Zambian crops. On the consumption side, volatile corn output and limited entry from otherproducers on the sugar market will keep prices elevated for Zambian consumers.
Key BMI Forecasts
Zambian corn production growth from 2015/16 to 2019/20: 1.6% to 2.8mn tonnes. We have reviseddown our corn production forecast due to our Country Risk team's expectation for the kwacha todepreciate heavily over the next five years. This will translate into a higher cost of imported inputs,thereby reducing fertiliser use across the Zambian crop.
Zambian sugar production growth from 2015/16 to 2019/20: 3.1% to 524,200 tonnes. The expecteddepreciation of the kwacha will also affect Zambia's sugar sector, as producers will face increased inputcosts, which will weigh on growth.
2016 real GDP growth: 3.4% (up from 3.1% last year)
2016 consumer price inflation: 18.5% (up from 13.9% last year)
BMI universe agribusiness market value: USD1.3bn in 2015/16, a 2.8% increase on 2014/15.
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