South Africa Plants Smallest Corn Area Since Worst Drought

(Bloomberg) -- South African corn farmers, who historically produce the continent’s biggest harvest, have probably planted the smallest area with the grain since the worst drought on record three years ago.

Producers have covered 2.27 million hectares of ground with corn this season, 2.1 percent less than in 2018, Lusani Ndou, a senior statistician at the Pretoria-based Crop Estimates Committee, said by phone Tuesday. That compares with 1.97 million hectares forecast in a Bloomberg survey and would be the least since the 2015-16 season. Then, the crop was ravaged by a lack of rainfall that was the worst since records started in 1904.

The area for white corn, which is used to make a staple food, is 0.8 percent smaller at 1.26 million hectares, while that for yellow, generally used for animal feed, is seen shrinking 3.7 percent to 1.01 million hectares. The sunflower area is 26 percent smaller at 444,000 hectares, the smallest in nine years, while the groundnut area, which is 66 percent down at 19,200 hectares, is the smallest on record.

The decline is due to less favorable rainfall and warm temperatures experienced in the peak planting window, Ndou said.

Expectations of good rainfall in corn-growing regions over the coming weeks may help farmers, Standard Bank Group Ltd. analyst Penny Byrne said in a note. White-corn futures climbed to a two-year high 3,350 rand ($246) a ton on Jan. 21.

“We expect prices will move lower on the back of this positive area-planted data as well as a positive rainfall outlook,” Byrne said.

The committee reduced its estimate for the nation’s wheat crop by 1.7 percent to 1.8 million tons compared with its prior prediction. South Africa produced 1.54 million tons of wheat in the previous season.

To contact the reporter on this story: Felix Njini in Johannesburg at fnjini@bloomberg.net

To contact the editors responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net, Ana Monteiro, Hilton Shone

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