July 2 (Bloomberg) -- South Africa, the continent’s biggest corn producer, will start tracking how much of the grain will be imported and exported to prevent price swings and excessive shipments that could threaten local food supply.
Grain SA, the biggest representative of commercial grain farmers in South Africa, asked the Department of Agriculture’s National Agricultural Marketing Council to chair a committee that will collate the data after a government-backed plan to export a record surplus cut stocks to the lowest in at least 12 years by the end of April. The nation shipped the most corn in the season through April since 2003-04.
An antitrust crackdown that led to grain miller Pioneer Foods Ltd. being fined a record 500 million rand ($61 million) in 2010 curbed information-sharing in the industry, leaving buyers unclear on how much corn is leaving the country.
“An efficient market requires transparent information systems that are timely and accurate,” Andre Jooste, who is a senior research manager at the NAMC, said in an e-mailed response to questions on June 28. “The mechanism will contribute to this and will have a significant enhancement of the agricultural information system in South Africa.”
The local price of white corn, used to make the corn meal eaten by many of the nation’s citizens, rose to a record on Jan. 25 on concern exports are depleting stocks.
The NAMC chairs the government’s Crop Estimates Committee, which releases forecasts on grain output and plantings on the agriculture department’s website. The South African Grain Information Service also reports historical delivery, import and export data weekly and provides information on stocks of grains on a monthly basis.
“We know exactly when cargo is leaving the ports and by the end of that month it will be in our stock situation,” Jannie de Villiers, Grain SA’s chief executive officer, said in an interview. “But when you talk to traders and ports people who deal with loading ships, they’ve already sold some grain, and that forms part of our local stock. They must declare it so it can be deducted from the local stock.”
The information-sharing committee, which will comprise of farmers, traders, food manufacturers and government departments, plans to hold its first session on July 10, Ronald Ramabulana, NAMC chief executive officer, said by phone from Pretoria on June 27. The committee will also track intended imports and exports of wheat, sunflower and soybeans.
“With that in place, there will be a bit more clarity in terms of the volumes that are actually going to be exported, rather than the intentions to export,” Ramabulana said.
White corn for December delivery, the most active contract, rose 2.1 percent to 2,300 rand ($282) a metric ton by the midday close in Johannesburg. The yellow variety increased 2.2 percent to 2,270 a ton.
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