South Africa Corn, Wheat Rise to Records on Weak Rand, Droughtby
Weaker rand makes local varieties more attractive than imports
Stocks of yellow corn fell 17% in October from month earlier
South Africa yellow corn and wheat climbed to records in Johannesburg trading after the rand weakened against the dollar, making imports more expensive, and as a lack of rain in the main grain-growing regions persists.
Yellow corn for delivery in March rose 1.4 percent to 3,232.80 rand ($227) a metric ton by midday on the South African Futures Exchange, the highest level since August 1996. Wheat for delivery in the same month, increased as much as 0.8 percent to a record 4,640 rand a ton.
“Large parts of the Free State, which is the biggest maize-producing province in South Africa, have received little or no rain,” Brink van Wyk a trader at BVG (Pty) Ltd., said by e-mail. “Worse even, the forecasts do not really show any rain there soon.” He said the decline in the rand, which has depreciated 23 percent against the dollar in the past 12 months and slipped to a one-week low Thursday, also contributed to the increase in prices.
Towns in the Free State and North West provinces, which together made up 64 percent of the nation’s corn crop in 2014, have no rain forecast until Nov. 28 according to the yr. no weather website. The country started grain imports for the first time in 11 months in March as the worst drought since 1992 damaged the harvest. South Africa is the world’s biggest producer of white corn after Mexico, used to make a staple food known locally as pap, and uses the yellow type is mainly to feed animals.
Local yellow-corn stock levels declined 17 percent to 2.32 million tons in October from a month earlier, the South African Grain Information Service said on its website Wednesday.
No rain is expected today throughout the Western Cape province, which produced 51 percent of the nation’s wheat in 2014. While South Africa is the sub-Saharan region’s biggest grower of the cereal after Ethiopia, it’s still a net importer, according to U.S. Department of Agriculture data. The Swartland area has had its driest season in 75 years, Agri Wes-Cape, a farming lobby group in that region, said in October.