South Africa: Maize crop harvest forecast falls

By Ed Stoddard and Zandi Shabalala
Posted on Wednesday, 27 January 2016 12:00

The forecast harvest, expected to be the smallest crop since 2007, was 8.5 higher than market expectations of 6.86 million tonnes, according to a Reuters’ poll of traders.

The maize crop will consist of an estimated 3.27 million tonnes of white maize and just over 4.17 million tonnes of yellow, the CEC said in its maiden forecast for this year’s crop, which it provided a month earlier than usual to assist policy makers plan for potential shortages.

The government has estimated that up to 6 million tonnes of maize may need to be imported this year, over half of the country’s needs. Domestic maize prices have been scaling all-time peaks as drought concerns have mounted after South Africa last year recorded its lowest rainfall levels since records began in 1904.

The central bank, which is expected to raise interest rates on Thursday, has repeatedly expressed concern about the drought and its impact on inflation, which accelerated to 5.2 percent in December from 4.8 percent in November.

The situation is especially worrying for the white variety of maize, which is the staple source of calories for many households and is not widely grown outside of the region. Yellow maize, used for livestock, can be easily sourced elsewhere.

An El Nino weather pattern is forecast to keep much of the maize belt hot and dry until the end of the growing season in April and record-high temperatures were posted in many parts of South Africa earlier in January.

South African maize farmers are estimated to have planted 1.99 million hectares for the 2016 season, down 25 percent from the 2.65 million hectares they seeded last year because of the drought, the CEC said.

Understand Africa's tomorrow... today

We believe that Africa is poorly represented, and badly under-estimated. Beyond the vast opportunity manifest in African markets, we highlight people who make a difference; leaders turning the tide, youth driving change, and an indefatigable business community. That is what we believe will change the continent, and that is what we report on. With hard-hitting investigations, innovative analysis and deep dives into countries and sectors, The Africa Report delivers the insight you need.

View subscription options