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February 9, 2018

Conab Increases Brazilian Soy Estimate Lowers Corn Estimate

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

In their February Crop Report, which was released yesterday (February 9th), Conab increased their 2017/18 Brazilian soybean estimate and they lowered their 2017/18 Brazilian corn estimate.

The 2017/18 Brazilian soybean crop is now estimated at 111.5 million tons or an increase of 1.1 million tons from their January estimate. The current crop is still lower than the 2016/17 Brazilian soybean crop by 2.2% or 2.5 million tons. The 2016/17 Brazilian soybean crop set an all-time record at 114.0 million tons.

The 2017/18 soybean acreage is estimated at 35.0 million hectares (86.4 million acres), which is an increase of 3.3% compared to last year. The nationwide soybean yield is estimated at 3,185 kg/ha (46.1 bu/ac), which is down 5.3% from last year's yield of 3,364 kg/ha (48.7 bu/ac). The soybean harvest is under way in Mato Grosso, but it is just starting in the states of Parana, Goias, and Mato Grosso do Sul. The soybeans were planted later in Rio Grande do Sul and in northeastern Brazil, so the soybeans in those two regions are now starting to set pods.

Conab made a significant reduction in their 2017/18 Brazilian corn estimate. The total corn production in Brazil for 2017/18 is now estimated at 88.0 million tons, which is down 4.3 million tons from their January estimate. The Brazilian corn crop is now estimated to be 9.8 million tons less than last year's production of 97.8 million tons.

Conab is estimating the full-season corn crop at 24.7 million tons (28% of the total Brazilian corn crop) and the safrinha corn crop at 63.2 million tons (72% of the total Brazilian corn crop).

The full-season corn acreage is down 8.9% from last year and the yields are down 10.8% from last year with the total production down 18.8% compared to last year or a reduction of 5.7 million tons. Brazilian farmers opted to reduce their full-season corn acreage in favor of more soybeans due to the higher returns for soybeans and low domestic corn prices.

The safrinha corn acreage is down 5.6% compared to last year and the yields are down 1.8% from last year with the total production down 6.1% compared to last year or a reduction of 4.1 million tons. This is Conab's first survey based estimate of the safrinha corn crop. Up until this point, they basically carried forward the estimates from last year.

Brazilian farmers are expected to reduce their safrinha corn acreage due to delayed harvesting of the soybeans and low domestic corn prices.