Brazil: harvest touches 3%, likely to pick up speed

Harvest of second-corn crop, also known as safrinha crop, in Brazil is gathering pace, putting pressure on corn prices in the spot and futures market.

Harvesting in the major corn-producing states of Brazil, which accounts for 92% of the cultivated area, was at 3% as of June 4, Brazil’s national agricultural agency Conab said.

Harvest works continue to be concentrated in Mato Grosso and Parana states and could have advanced even more if the corn grains moisture were not so high, according to private consultancy AgRural.

The most active September corn futures contract on Brazil’s B3 exchange closed at Real 89.66/60-kg bag on June 6, down from Real 92.75/60-kg bag a week ago.

The arrival of large volumes from the second corn crop in Brazil raises expectations of price reductions, S&P Global Commodity Insights said in its prices assessment report on June 6.

Conab forecasts Brazil’s total corn production in the marketing year 2021-22 (February-January) at a record 114.6 million mt.

Brazil’s 2021-22 corn crop will be marketed from February 2022 to January 2023.

The first-corn crop in Brazil is planted from September-December and harvested over February-May, while the second crop is planted from February to March and harvested in June-July.

The weather forecast in Brazil is also largely favorable for corn harvesting in most part of the Centre-South region, Brazil’s National Institute of Meteorology, or INMET, said on June 6.

Second corn production estimate in Mato Grosso, the largest producer in Brazil, was cut slightly to 39.156 million mt in 2021-22 from 39.347 million mt projected earlier, the Mato Grosso Institute of Agricultural Economics, or IMEA, said in a report.

The revision in the state’s corn output was due to lack of adequate rain since April, which hit the corn crops sown after the ideal planting window, IMEA said.

Mato Grosso produced 32.56 million mt in 2020-21.

Although corn production in the state is seen higher this year, crop yield is expected to be around 102.10 bags/hectare in 2021-22 (1 bag = 60 kg), down from 109.02 bags/ha in 2019-20 and 110.91 bags/ha in 2018-19, according to IMEA.

Tags: weather, Production, output, Market, safrinha crop, second-corn crop, harvest, corn, Brazil, prices