South Africa Secures Corn Deals, Prevents Collapse
April 26, 2010
Bloomberg reports South Africa is preparing to reap the biggest corn harvest since 1982, by securing deals to sell excess grain to the World Food Program and nations such as Kenya as the state aims to halt a price slump threatening to wipe out local farms. Corn producers, represented by Bothaville-based Grain SA, estimate the surplus this season at about 4 million metric tons following a favorable level of rains for the crop. South Africa typically exports about 2 million tons, it said. White corn on the South African Futures Exchange has fallen 36 percent this year to 1,081 rand a ton, while yellow corn slid 26 percent to 1,160 rand a ton. Farmers need an average price of about 1,500 rand a ton to cover costs, according to Grain SA. South Africa is expected to reap 12.96 million tons of corn this year, according to the state Crop Estimates Committee. Africa’s largest economy normally consumes about 9 million tons. Producers met with regulators to seek guidance on the legality of setting aside part of the surplus for export.