South Africa May Miss Corn-Harvest Forecast on Drought, Agbiz Says

(Bloomberg) -- South Africa is likely to miss forecasts for corn output this year because dry weather has delayed plantings and possible frost at the end of the season may hurt the crop, the Agricultural Business Chamber said.

The chamber had estimated production for the 2018-19 season at 12.2 million tons. Late summer rains in the Free State and North West provinces mean farmers planted after the optimal window to sow closed in mid-December, it said Monday. By Jan. 11, 60 percent of the intended area for the North West was planted and the figure was 70 percent for the Free State, while other regions managed to plant typical areas, the chamber said.

That suggests that the intended area of 2.44 million hectares (6 million acres) for corn in the season could probably fall by about 19 percent to 1.98 million hectares, said Wandile Sihlobo, the head of agribusiness research at the chamber.

“This would be almost in line with the area planted during the drought period of the 2015-16 production year. At that time, South African maize production amounted to 7.8 million tons, turning the country into a net importer, as annual maize consumption is roughly 10.8 million tons,” he said.

The country is Africa’s top corn producer, but profitability has been squeezed as a record crop in 2016-17 that boosted stockpiles was followed by another good harvest.

Rainfall in 2015 was the lowest since records began a century earlier because of El Nino, with cities including Johannesburg recording their highest temperatures yet. Cape Town, among the continent’s top tourist destinations, is recovering from its worst drought that’s seen water rationing.

The dry weather conditions raises the specter of a drought that could be worse than one the nation experienced in 2016, Jannie de Villiers, Chief Executive Officer of Grain SA, a farmers’ lobby group, said last month.

“Some of the scenarios we are facing look even grimmer than the previous drought,” De Villiers said. “If we consider the current crop status planted, late plantings or even no plantings, the farmers and South Africa are in for a very rough ride in 2019.”

©2019 Bloomberg L.P.