The price of white corn in South Africa will probably keep climbing after more than doubling from a year earlier as retailers pass on the rising costs to customers, according to the largest industry group.
White corn for delivery in December, used to make a local staple food known as pap, has surged 54 per cent this year while the yellow variety has increased 33 per cent. The price of white corn has jumped to 3,310 rand ($269) a metric ton as a drought reduces the harvest of the grain to what’s predicted to be the smallest in eight years, according to an official estimate.
“Going forward, one can expect the current high maize prices to continue filtering through the retail grain related food-stuff prices,” Wandile Sihlobo, an economist at Grain SA, said in an e-mailed response to questions. “High food prices are possible throughout this year.”
The country could be a net importer of grain for the first time in seven years as the worst drought since 1992 damaged the harvest in the main growing provinces of the Free State and North West, which together made up 64 per cent of the nation’s crop in 2014. South Africa is the world’s biggest producer of white corn after Mexico. It uses the yellow type for animal feed.
News by Bloomberg, edited by ESM
