White and Yellow Corn Surge to Record in South Africa on Droughtby
Some rain is seen falling today in corn-growing provinces
Weather likely to be main driver of prices until next year
White and yellow corn in South Africa, the continent’s biggest producer of the grains, surged to a record as the worst drought in 23 years continues to harm crops in the main growing regions.
White corn for delivery in March climbed 2.9 percent to 4,200 rand ($278) a metric ton by midday on the South African Futures Exchange. That is the highest for a most-active contract since at least August 1996. Yellow corn gained 2.4 percent to 3,490 rand a ton.
“Weather has been and is likely to remain a key underlying factor in the domestic maize industry until February or March 2016,” Wandile Sihlobo, an economist at farmers’ lobby group Grain SA, said in an e-mailed report Friday. “Large parts of South African maize-producing regions remain dry and some areas, particularly the western areas, have not progressed much with planting.”
South Africa, the continent’s biggest producer of corn, is suffering from the effects of the El Nino pattern that has caused dry conditions in its largest growing provinces of the Free State and North West. The two areas, which made up almost two-thirds of production in 2014, are expected to have below-average yields this year. Only 11 percent of the intended area in the northwest and central parts of the Free State has been sown while plantings in North West province were estimated at 22 percent of the intended hectares. The optimal corn-planting window has passed.
The town of Klerksdorp in the North West may have 5.4 millimeters (0.2 inch) of rain Friday, according to data on the yr. noweather website. The Free State town of Kroonstad may get 2.4 millimeters.
“Some producers in these areas might still plant until the end of December 2015 if they get sufficient rainfall,” said Sihlobo. “These areas mostly produce white maize and these factors have led to significant increases in prices.”