39 / 104 1 . OUR STORY AND OUR PURPOSE
Although the Senwes Group ' s overall strategy ( purpose ) remains unchanged , it is suitably agile to respond to , and where applicable accommodate any changes . We are driven by our clients ’ needs to provide solutions through product and service . If they thrive , then we will , as a result thereof , also thrive !
Graph 1 : Exchange rate ( rand vs dollar )
R /$ R /$ Index ( May ' 13 = 100 )
20,00
18,00
16,00
14,00
12,00
10,00
250
200
150
100
50
Some of the practical outcomes of our operational environment in 2021 / 22 were :
• Disruption of supply chains ( slower and more volatile ).
• Physical supply was more important than price in some cases .
• Logistical cost more than doubled ( graph 2 ).
• The whole energy complex repriced to a much higher level .
• South Africa imported more than 80 % of its fertiliser and 90 % of its agrochemicals .
• Fuel will now also be imported as finished product to a large extent , with the resultant instability of physical supply ( graph 3 ). During the 2008 commodity run , Brent crude oil reached $ 140 per barrel level ( graph 4 ).
• The pricing of grain commodities was also affected positively and maize , sunflower , soybeans and wheat reached very high levels ( graph 5.1 to 5.3 and graph 6 ). The gross value of these four commodities , at a national level , was more than R90bn this production year .
• New season input costs for producers will be more than 30 % higher than the previous year .
• In the future , producers will not only consider their production cost , but also their crop planning due to fertiliser availability and pricing . The global fertiliser application is 120kg / ha ( graph 7 ), while that of South Africa is at least double – this is clearly not sustainable .
• Higher inflation rates and more specifically higher food price inflation ( graphs 8 and 9.1 to 9.3 ) have and will
8,00
Graph 2 : Logistical cost
300
250
200
150
100
50
0
IGC Grains and Oilseeds Freight Index ( GOFI ) & sub-Indices ( Weekly basis , 1 January 2013 = 100 )
May-13 Aug-15 Dec-17 Dec-19 Jun-20 Nov-20 May-21 Nov-21 Apr-22
Graph 3 : Local petroleum production
140
120
100
80
60
40
20
Coke , petroleum products and nuclear fuel production index ( Base 2015 = 100 ) Linear ( Coke , petroleum products and nuclear fuel production index ( Base 2015 = 100 ))
-41 % decline over 5 years
-31 % decline over 10 years
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Apr-12 |
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Graph 4 : Brent crude oil price
160
140
120
100
80
60
40
20
Apr-13 Apr-14 Apr-15 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 Apr-21 Apr-22
US $/ barrel
0
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Apr-08 |
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Apr-22 |
SENWES INTEGRATED REPORT 2022
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