S. African Corn Rose Over Concerns of Insufficient Rain

(Businessweek) – South African corn futures gained on concern that there was insufficient rain in the country’s main growing regions during the weekend, after weather predictors said there would be good showers.

White corn for delivery in March, the most active contract, climbed 1.2 percent to 2,206 rand ($248) a metric ton, the highest since Jan. 4, by the close on the South African Futures Exchange in Johannesburg. The yellow variety, for July delivery increased 1.1 percent to 2,121 rand a ton.

“The weather charts had predicted a lot of rain for over the weekend, but the rain was not as great as everyone expected,” Benjamin Swanepoel, a trader at Trademar Futures (Pty) Ltd., said by phone from Johannesburg. “Even for the coming week, no rain has been predicted for the whole of South Africa and there are concerns about that, that’s why the prices are up today.”

Good showers had been expected for Bothaville in the Free State province, which produces 40 percent of the nation’s grain, the South African Weather Service said on its website on Jan. 17. No rain has been forecast in the region for the next five days, the weather service said.

South Africa is the continent’s biggest producer of the grain. White corn is a staple food, while the yellow type is used as animal feed.

Wheat for March delivery increased 0.2 percent to 3,632 rand a ton.

To contact the reporter on this story: Tshepiso Mokhema in Johannesburg at  tmokhema@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at  asguazzin@bloomberg.net