Maize deliveries rise, calm shortage fears

Maize deliveries to silos rose slightly in the last week of August, easing fears over an expected crop shortage, South African Grain Information Service data showed.

Maize deliveries to silos rose slightly in the last week of August, easing fears over an expected crop shortage, South African Grain Information Service data showed.

Farmers delivered 39000 tons of maize last week, up from 36000 tons in the previous week.

The increase brought total maize deliveries to the market so far to 5,6million tons.

The latest figures have calmed earlier speculation that the country might not achieve its crop forecast. "I think if you take the current figure and factor in the million or so tons that haven't been added to that number then we actually might reach the Crop Estimates Committee's estimate," a Johannesburg trader said.

The committee left its production forecast for this season a fraction down at 6,9million tons from the previous month.

The grain information service's maize delivery figures consistently have lagged the committee's predictions, leading many traders to doubt whether the committee's target could be reached.

While the market awaited clarity on the output figures, it has taken its direction from international prices and the rand.

December white maize futures were up 2,36percent yesterday while yellow maize also rose by a similar margin. Both contracts traded at R1950 per ton.

"We basically had a limit move today with Chicago up overnight and the rand also trading weaker. There, however, has been a bit of selling interest still there and we'll continue to see it trading around R1950," another trader said.

Prices have been pushed up by expectations that the crop will fall well under annual demand of 8million tons after drought and early frost hit the maize growing region. - Reuters

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