Forecasts for a record winter corn crop in Brazil look overly optimistic after summer rains ended sooner than expected, which could prolong the country's recently aggressive imports of the grain and even trim the area planted to soybeans in September.
The Agriculture Ministry's Conab crop supply agency is expecting a record 57.1-million-tonne winter corn harvest in the coming months, up from 55.3 million tonnes last year. Mato Grosso state is forecast to account for 20 million tonnes alone. Brazil's large poultry industry signed import deals for 500,000 tonnes of corn from Argentina and Paraguay for the coming months, after traders exported a record 35 million tonnes of the grain from July through March.
After late rains delayed the planting of Brazil's soybean crop in late 2015, farmers had to hold off harvesting fields that they typically replant with winter corn after the soy. This helped push 35 percent of the winter corn planting out of the favorable window of the rainy season that in recent years favoured bumper crops, agricultural consultant Kory Melby said.
Weather models see rains reaching the center-west corn belt around April 27, which if confirmed, would likely guarantee Mato Grosso at least an 18 million tonne corn harvest and ease local supply concerns, he said. Corn prices have been holding around record levels of 50 reais ($14.15) per 60-kg bag.
"If this dry weather stays another 3 weeks or more, however, .... the second-crop corn will be a failure, the local corn (prices) will remain strong and (you'll see) a big switch from soy to first crop corn in southern Brazil in September," Melby said. Meteorologist Marco Antonio dos Santos at forecaster Somar estimates the crop needs a minimum 70 millimeters of rain through April, but a hot air mass has kept fresh rains from entering the region.
"This corn that was planted later needs a lot of rain in April, which isn't going to happen," he said. Andre Pessoa, director at analysts Agroconsult, said corn estimates are already being revised lower. Agroconsult is forecasting Brazil will import nearly 700,000 tonnes of corn from Argentina through 2016, which would be the most since 2000. Daniele Siqueira, an analyst at consultants Agencia Rural, said Brazil could also reduce its exports if dry weather takes a major toll on the winter crop. This would divert global corn buyers to other exporters like Argentina and the United States. Conab expects exports to be at a near-record 30 million tonnes.
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