South African White Corn Rises by Limit on Dry Weather Concern

December 19, 2016 10:26 AM

South African white-corn futures rose by the daily limit for a second day as dry weather and forecasts for two weeks without rain raised concern about the strength of a recovery from last year’s poor harvest.

The country’s prime corn-growing areas in the Free State and Mpumalanga provinces had strong rain in November, following the worst drought since records started in 1904 last year. The dry weather has returned to the Free State this month, Brink van Wyk, a trader at BVG (Pty) Ltd., said by phone.

“We were all lulled by the good rains last month but now the forecasts show very little until at least the new year,” Van Wyk said. “In some areas, the crop is covered with sand -- it’s that dry.”

White corn for delivery in March climbed by as much as 100 rand ($7.16), or 2.6 percent, to 3,895 rand a metric ton by 9:38 a.m. in Johannesburg. The most actively traded contract touched a low this year of 3,428 rand on Oct. 10.

“Despite widespread rains over large parts of the country, parts of the Northern Cape, Western Cape, North West, Limpopo and the Free State are still in the grip of the worst drought this decade,” AGRI SA, the biggest organization representing farmers in the country, said in an e-mailed statement Monday. “We therefore urge government and the private sector to contribute so that we can again be in a position to support these communities in their battle for survival.”

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