A dry spell in South Africa’s maize belt is threatening the overall crop, causing prices to spike.

There are fears that a lack of rain in the next two weeks will diminish the size of the coming crop and result in South Africa being forced to import maize.

As a result of these concerns, on Friday the price of white maize shot up by R80 to close at R2 409 a ton, the highest level since March last year.

Fears around the dry weather and its impact on the maize crop have sent the spot price for white maize up by 23 percent over the past week.

Maize farmers warn that if there is no rain in the next 10 days, it could result in tragic conditions in the grain farming communities and the rural economy.

“This will result in high food prices for the next 12 months at least,” Jannie de Villiers, the chief executive of Grain SA, said.

“The maize produced under irrigation represents almost 20 percent of the crop and is taking strain as well, with all the load shedding.

“If we have a crop failure this year, we can see prices increase further by almost 30 percent,” he said.

“Maize meal is the biggest staple food in South Africa, especially for the poor, and forms the basis for processed products like poultry, dairy and meat.”

De Villiers said good rains in the next 10 days could change the direction the crop was going at the moment.

“But currently it does not look good,” he added.

Riaan Gerber, an analyst at Derived Market Investment Planning, said the market was responding to the dry spell.

“The forecast for the next seven days shows that there will be dry weather and in the last two weeks there was no rain in most of the maize farming areas.”

Gerber said this might push the price of maize further up.

“It will even push South Africa to import maize at some stage, depending on how long it (the dry spell) lasts. If the drought persists, the maize price in the market might even go higher,” he said.

Thys Grobbelaar, a Senwes analyst, said damaged fields were visible across the maize farming areas, especially in the North West and north-west Free State.

He said the next 10 days were critical for the maize crop because almost 80 percent of the crop was in pollination, which was one of the critical stages for a maize plant.

“The plant will need a lot of energy and for that to happen it will have to use a lot of water to produce that energy,” Grobbelaar said.

He said the dry conditions would definitely affect the country’s crop yields.

Although he could not give an exact estimation, he said the 2014/15 crop would “just be enough for the local market”.

“If the rain in the next five days is good, I do not think that we will need to import white maize, but if it does not rain we might have to import.”

The dry weather conditions will also affect the yield of soya beans.

Cobus Cronje of SA Weather Services said there was a small chance of rain expected in the eastern parts of the Free State and northern parts of North West.

He said the rain would spread to the western parts of the Free State by Wednesday.

However, Cronje said the country was not experiencing a drought as yet, but rather below-normal rain compared with last year.

AgriSA’s president Johannes Moller said South African farmers were in a similar position to last year.

He said maize farmers would be able to meet the demand of the southern African market, “but should the dry conditions persist, then we will have to import”.

The drought has not only affected maize farmers but sugar canegrowers as well, especially in KwaZulu-Natal.

The canegrowers said last week that they were close to losing about R920 million because of the drought.

Source - http://www.iol.co.za