South African yellow corn rose to the highest price on record as demand increased due to dry weather and a fall in the country’s currency that made importing more expensive.
Yellow corn gained 1.6 percent to 2,870 rand ($264) a metric ton by the close of trading on the South African Futures Exchange in Johannesburg, the highest on record.
“The weaker rand means higher import costs, so that’s pushing up demand for domestic supply,” Thys Grobbelaar, an analyst at Klerksdorp, South Africa-based Senwes Ltd., said by telephone. “The market is also nervous about low rainfall in growing areas, which could affect this year’s crop.”
The South African rand fell to a five-year low against the dollar. Supplies of white and yellow corn have been hampered by low rainfall in the 2012 and 2013 planting seasons, particularly in the North West province.
South Africa has about 3.1 million tons of corn stocks remaining until April, when the harvest begins, said Corne Louw, an economist at Grain SA, which represents commercial farmers. The country uses about 900,000 tons a month, indicating a shortfall of about 500,000 tons by April.
White corn for delivery in March fell 0.1 percent to 2,928 rand a ton, while wheat rose 0.5 percent to 3,728 rand a ton.