South African corn futures rose to the highest level in more than three weeks as the continued lack of rain raises concern about the harvest.
White corn for delivery in July, the most active contract, rose 1.1 percent to 2,057 rand ($232) a metric ton, the highest since Jan. 29, by the close on the South African Futures Exchange in Johannesburg. The yellow variety for delivery in the same month gained 1 percent to 2,055 rand a ton.
There is no rain predicted until Feb. 25 for Bothaville in the Free State, where 40 percent of the nation’s corn is produced, according to the South African Weather Service’s website.
“The lack of rain situation continues to pose a threat,” Andrew Fletcher, an independent trader, said by phone from Kroonstad in the Free State province. “The market is now looking at production factors and that is taking the price up.”
A median estimate of six analysts surveyed by Bloomberg News showed that farmers may increase corn output by 5.9 percent to 12.5 million tons this season from a year earlier. The Crop Estimates Committee will release its data on Feb. 26.
South Africa is the largest corn producer on the continent. Meal made from white corn is one of the country’s staple foods and the yellow variety is mainly used as animal feed.
Wheat for March delivery fell 1.2 percent to 3,446 rand a ton.
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