Maize meal price increase
Namib Mills hereby announces that due to a severe drought causing a drastic drop in crop expectations, the company will unfortunately have to increase maize meal prices. Maize meal price increases are unavoidable as a result of the current drought which has seen crop estimates lowered by almost half.
Due to poor rainfall in the main white maize production areas, the price of raw white maize has drastically increased with approximately 50% during the last couple of weeks. The effect on white maize meal is an increase of 17%, effective 23 March 2015.
The tipping point regarding the mid-summer drought was on the 29th of January 2015, when the commodity market, Safex, started to rise dramatically over a 2 week period, from levels of N$2,026 ex-Randfontein to a high of N$2,998 per tonne of white maize.
On 9 February 2015, Namib Mills announced a price reduction on maize meal of approximately 5%, but the recent extreme volatility in the white maize price (a result of the poor crop expectations) makes it necessary to increase prices accordingly. After taking the recent decrease into account, the aggregate increase is in effect 11% calculated on the price-level before the 5% decrease.