April 3, 2008

South Africa reports of lowest grain stock in 11 years

South Africa has the lowest grain stock levels in eleven years due to poor production, drought and high international prices, the Grain South Africa reported Wednesday.

Grain SA chairperson Neels Ferreira said the limited availability of yellow corn also resulted in more white grain taken up by the animal feed market.

Summer grain stock levels, corn in particular, seem to be at its lowest point in years, according to the South African Grain Information Service (SAGIS), said Ferreira.

The 106 million tonnes of carry-over stock of corn represents 11.4 percent or 40 days consumption of the total annual commercial demand.

Furthermore, South Africa's stock levels of other summer crops such as sorghum and sunflower seed will hardly be enough to maintain the pipeline stock, Grain SA disclosed.

Meanwhile, the National Crop Estimate Committee indicated that summer grain harvests could be higher than the previous year.

Ferreira noted that the improvement of corn by more than 51 percent and soy by more than 45 percent takes place from a low base.

He pointed that despite the expected larger harvest, the carry-over stock would be low at the end of April 2009, the end of the next marketing season.

The recent report of the USDA that US farmers would decrease corn planting by 8.1 percent also translates to South African stock reduced by half in the coming season.