An assessment of South Africa's non-genetically modified maize export potential

Joseph Leshasha Mawasha

Working Papers from African Economic Research Consortium

Abstract: The study endeavoured to determine South Africa's export potential in non-genetically modified maize markets using a three pronged methodological approach. The Genetically Modified (GM) status of South African maize has been observed as a challenge restraining the extent of South Africa's maize exports to major maize importing markets. The study thus sought to quantify South Africa's maize export potential to non-GM maize markets. Firstly, the study identified South Africa's non-GM maize markets using a growth share matrix. Secondly, South Africa's non-GM maize export markets with high trade potential were identified using an Indicative Potential analysis. A gravity model was then used to determine potential export markets with trade stimulating and restraining effects. The study finds that Italy, Angola, Zimbabwe, Venezuela, Greece, Zambia and Austria exhibited the highest trade potential among the identified potential non-GM maize markets. Based on the three pronged approach employed by the study, it was concluded that despite the limited scope for non-GM maize market penetration, there are markets which displayed greater potential for expansion as they were part of the most desirable markets, exhibited high trade potential and had trade stimulating effects. These markets include; Italy, Zimbabwe, Kenya and Angola. It was recommended that farmers who choose to engage in large scale non-GM maize production should thus be guided by the forces of demand and supply in the non-GM maize export market and react to favourable opportunities as presented. Moreover, the government of South Africa needs to maintain a regulatory system that enables for segregation of non-GM and GMO maize along the maize value chain to allow for preference for South African non-GM maize by major non-GM maize importers.

Date: 2020-02
Note: African Economic Research Consortium
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