Johannesburg - South African white-corn futures fell from yesterday’s record high after a technical indicator signaled the gain was exaggerated.
White corn for delivery in March dropped 2.1 percent to 3,148 rand ($282) a metric ton, the lowest since January 28, by the noon close on the South African Futures Exchange in Johannesburg.
Prices touched 3,365 rand yesterday.
Yellow corn for delivery in July gained 1 percent to 2,205 rand a ton.
The relative strength index for white corn, a gauge of whether a commodity is overbought or oversold, was above 72 yesterday after exceeding 85 last week.
Readings higher than 70 indicate a potential impending drop to some analysts who study technical charts.
“The market must have made a correction,” Lindy van Blommestein, a trader at Farmwise Grains (Pty) Ltd., said by telephone from Johannesburg today.
“Speculators pushed prices too high.”
White corn rose to records as national stockpiles of the grain fell 25 percent by December 31 from a year earlier, the Pretoria-based South African Grain Information Service said January 24.
Inventories slid to 1.84 million tons and stocks of the yellow variety declined to 1.33 million tons.
South Africa is the continent’s largest producer of corn, also called maize.
Meal made from the white variety is used for a staple food known locally as pap and yellow corn is mostly fed to animals.
Wheat for delivery in March rose 0.8 percent to 3,829 rand a ton.
Soybeans for delivery in May added 1.7 percent to 6,000 rand a ton. - Bloomberg News