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South Africa's Drought Leads to Job Cuts, Surging Food Prices

  • Corn crop probably lowest since 2007 due to lack of rain
  • Food prices No. 1 upside risk to CPI outlook, BNP Paribas says

South Africa’s worst drought in more than a century is taking its toll on the economy as farms cut jobs and the cost of producing food surged.

Employment in agriculture decreased by 37,000 in the fourth quarter of last year, offsetting some job gains in government and finance and contributing to the 24.5 percent jobless rate, the Pretoria-based statistics office said in a statement on Thursday. Producer inflation for manufactured goods accelerated to an 18-month high of 7.6 percent in January and price growth for agriculture, forestry and fishing more than doubled to 23.6 percent from the previous month, Statistics South Africa said in a separate statement.