South African Corn Gains on Speculation Farmers Produced LessTshepiso Mokhema
Corn futures in South Africa increased the most in more than a week on speculation the country’s Crop Estimates Committee will predict a lower output for this season when they release data tomorrow.
“A lower or smaller crop will lead to a smaller supply so prices will increase due to that,” Benjamin Swanepoel, a trader for Trademar Futures (Pty) Ltd., said in an e-mailed response to questions today.
White corn for delivery in July, the most active contract, gained 1.1 percent to 2,162 rand ($228) a metric ton, the most since May 14, by the close in Johannesburg. The yellow variety for delivery in July rose 1 percent to 2,148 rand a ton.
Farmers are expected to produce 11.4 million tons of corn this year, according to a median estimate of six analysts surveyed by Bloomberg. This compares with a forecast for 11.6 million tons made by the Pretoria-based Crop Estimates Committee on April 25.
South Africa produced 11.8 million tons last year, down from 2010’s 12.8 million tons, which was the biggest crop since 1982. The nation is the continent’s largest producer of the grain. 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 July delivery closed up 0.5 percent at 3,520 rand a ton.