El Nino drought threatens huge African corn shortage

March 7th, 2016

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Category: Grains, Oilseeds

corn 450x299(Agrimoney) – Southern Africa is facing a massive food shortage, as prospects for the South African corn harvest remain grim.

El Nino-related dryness has manifested in what could be “one of the worst droughts in recent history”, the United Nations World Food Programme warned this week.

In particular, the drought in South Africa, the region’s breadbasket, is threatening supplies across the region.

The South African grain farmers association GrainsSA noted “forecasts of rainfall in the eastern and central parts of the country in the next 8-days”.

“However, it is important to note that weather forecasts have been showing possibilities of rainfall in the past few weeks but that has not yet materialised across many areas.”

Food shortages loom

The WFP now sees 16m Southern Africans facing hunger, excluding those in South Africa, with up to 50m potentially affected by the ongoing food crisis.

And with little sign of relief on the way, the number affected by hunger in Southern Africa could climb as high as 50m.

El Nino effect

The food shortage is being driven by a severe regional drought, which is associated with El Nino.

Some areas of Southern Africa has seen the lowest level of rainfall in 35 years during the October-January corn planting season.

“El Nino’s impact on rain-fed agriculture is severe,” the WFP said.

“Poor-rainfall, combined with excessive temperatures, has created conditions that are unfavourable for crop growth in many areas. In Lesotho, South Africa, Swaziland, Zambia and Zimbabwe, planting was delayed by up to two months or more and is expected to severely impact corn yields.”

“As the window for planting is now closed, even good late rainfall offers limited scope for recovery

Corn futures stay high

White corn futures in South Africa are down about 8% from their January peak, but they remain nearly twice the level they were a year ago.

Sourcing white corn, the region’s food staple, poses a particular problem, as it is not widely grown outside Southern Africa, except in Mexico.

Traditionally South Africa and Zambia have been the breadbasket of the region, but South Africa will this year be a large net-importer.

And stocks are squeezed in Zambia as well, with the 2016 harvest expected to fall around 30%.

Adding to the pressure is the weakness in the rand, hit by a strengthening dollar, lower commodity prices, and considerable political uncertaintry.

Rising yellow corn imports

As well as the white corn shortage, South Africa needs yellow corn to supply its livestock industry.

“This week South Africa recorded the highest yellow corn weekly imports on record for the 2015-16 season,” said GrainsSA.

In the week to February 26, South Africa imported 1560,545 tonnes of yellow corn.

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