Drought will limit South Africa’s corn crop to 11.5 million tonnes, nearly one-quarter less than last year’s harvest, the USDA says in its monthly WASDE report. “February dryness and periodic heat, particularly in the western and central growing regions,” disrupted pollination and slashed the likely yield, according to the report. South Africa is an important regional supplier and often acts as an indicator of prospects in the southern part of the continent. The nation is estimated to export 1 million tonnes of corn this marketing year. Exports usually top 2 million tonnes.
USDA specialists toured South Africa’s corn belt in early March “and observed average crop conditions in the east, below-average conditions in the central region, and very poor conditions or crop failure in the far west,” said World Agricultural Production, a companion report to WASDE.
The downturn in South Africa was a major reason why the USDA cut its global estimate of ending stocks by 2 percent, or 4.4 million tonnes. With “projected higher global demand,” the outlook improved for U.S. corn exports and farm-gate prices. The department raised the export forecast by 50 million bushels and the season-average price by 5 cents a bushel. At $3.70, it would be the lowest average farm price in five years. Corn supplies are at high levels worldwide after back-to-back bumper crops. The U.S. stockpile at the end of this marking year, forecast for 1.777 billion bushels, would be the largest in nine years.