Brazil expecting smaller corn, wheat crops

Smaller corn and wheat crops are forecast for Brazil in the 2023-24 marketing year, but rice production is expected to increase, according to a Global Agricultural Information Network report from the Foreign Agricultural Service (FAS) of the US Department of Agriculture.

Due to high production costs and lower expected earnings, corn producers’ profit margins are under pressure, the report said, which led the FAS to predict a 4% decrease in output, to 130 million tonnes, compared to the previous year’s record crop of 135 million tonnes.

Corn exports are expected to remain high, although they are seen declining by 2 million tonnes from the record outgo of 56 million tonnes in 2022-23, the report said. Consumption is expected to surge to a record 77.5 million tonnes in the current marketing year.

“In addition, the El Niño weather phenomenon is anticipated to continue having an impact on crops in the southern region of Brazil, particularly affecting wheat farms, which will likely result in lower yields,” the FAS said. About 90% of Brazil’s wheat is grown in that region.

Wheat production for 2023-24 is projected at 10.2 million tonnes, a 7% decrease from the previous year.

With rice prices rising while production costs have eased, more farmers are planting rice for the upcoming harvest, the FAS said. Rice harvested area is forecast at 1.5 million hectares, a 2% increase over the previous season. The FAS projects 2023-24 rice production at 7.01 million tonnes of milled rice equivalent (MRE), an equivalent of 10.3 million tonnes of paddy rice. This represents a 3% increase over the previous estimate and is credited to the larger planted area and the expectation of greater profitability by producers.

“The arrival of the El Niño phenomenon is expected to bring excess rain to Rio Grande do Sul, which would profit from rice cultivation in flooded areas and reduce the planting of soybean, which in recent years has been a favored crop for farmers in the region,” the FAS noted.

Tags: corn, Brazil, wheat, crop forecast