June 22, 2018

Safrinha Corn Harvest Getting Underway in Brazil

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

Brazilian farmers are getting started on harvesting their 2017/18 safrinha corn crop. In Mato Grosso the harvest is 6% complete with 3-4% harvested in Mato Grosso do Sul and 1% harvested in Parana.

According to the Mato Grosso do Sul Confederation of Agriculture and Livestock (Famasul), the safrinha corn in the northern part of the state, where the weather has been relatively good, is expected to yield 90 to 100 sacks per hectare (83 to 92 bu/ac). Corn yields in the southern part of the state will not be as good due to dry weather during April and early May and farmers are expecting yields in the range of 60 to 70 sacks per hectare (55 to 64 bu/ac), which would be down about 40% from what was expected. In the worst case scenario, some of the safrinha corn may not even be harvested due to very low yields. The final corn yield will not be determined until the harvest is completed probably sometime in August

Domestic corn prices have remained firm in Brazil for the last several months due to the problems in neighboring Argentina where a severe drought resulted in very low corn production. In recent months, farmers in Mato Grosso do Sul were forward contracting their corn in the range of R$ 33 to R$ 34 per sack (approximately $4.05 to $4.17 per bushel). The prices have eased back to the range of R$ 30 per sack (approximately $3.68 per bushel) and they are expected to remain stable.

The Brazilian government announced new minimum prices for corn for the 2018/19 growing season. In the states of Mato Grosso and Rondonia, the new minimum price for corn in 2018/19 will be R$ 17.93 per sack (approximately $2.20 per bushel) as compared to R$ 16.71 per sack in 2017/18 (approximately $2.05 per bushel), or an increase of 7.3%.

In the states of Parana, Mato Grosso do Sul, and Goias the minimum price will increase 11% to R$ 21.65 per sack (approximately $2.50 per bushel). In the states of Bahia, Maranhao, Piaui, and Tocantins the minimum price was lowered 2.1% to R$ 20.41 (approximately $2.50 per bushel).