JOHANNESBURG - South Africa will likely harvest 7.1 million metric tons of corn in 2016, 29 percent less than the 9.95 million metric tons reaped last year because of a drought and late plantings, a government agency said on Wednesday.
The forecast harvest, which the Crop Estimates Committee (CEC) said would be the smallest crop since 2007, is above market expectations of 6.77 million metric tons, according to a Reuters' poll of traders.
It was 2.6 percent lower than the CEC's previous estimate of 7.255 million metric tons. The crop will comprise an estimated 3.1 million metric tons of white corn and almost 4 million metric tons of yellow, the CEC said in its third 2016 corn forecast.
Domestic corn prices have been scaling all-time peaks as drought concerns mounted after South Africa last year recorded its lowest rainfall levels since records began in 1904.
This has helped fuel inflation, which accelerated to 7 percent in February, its highest in seven years, from 6.2 percent in January.
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Late rains have brought some hope to parts of the corn belt but much of the crop was planted months later than usual, meaning yields are expected to be poor.
The situation is especially worrying for the white variety of corn, the staple source of calories for many households and is not widely grown outside of the region. Yellow corn, used for livestock, can be easily sourced elsewhere.
An El Nino weather pattern blamed for the drought is seen fading from the autumn season in April and bringing above-average rainfall to much of South Africa but that will be far too late for the summer corn crop.
South African corn farmers are also estimated to have planted 1.946 million hectares for the 2016 season, down about 1 percent from the previous estimate of 1.965 million hectares and 27 percent less than the 2.65 million hectares they seeded last year, the CEC said.
