January 9, 2018

Brazilian Corn Production yet to be Determined

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

There continue to be concerns expressed about the Brazilian corn crop. A survey of Brazilian analysts conducted by Reuters indicated that the full-season corn acreage declined 11% and the production is expected to decline 17% compared to last year. The full-season corn crop will account for about 30% of Brazil's total corn production.

Approximately 70% of Brazil's corn production will come from the safrinha crop and there are a lot of concerns about that crop. A delay in the soybean planting and thus the soybean harvest, will push back the safrinha corn plating past the ideal planting window. I am estimating that 30-40% of the potential safrinha corn acreage will not be able to be planted before the ideal window closes.

With low domestic corn prices, there is a risk that some of these late fields may not get planted at all. Advisory firms are telling their clients that the only way they can make money on safrinha corn production is to achieve above trend line corn yields. If the safrinha corn planting is significantly delayed, the chances of achieving above trend line yields is essentially zero. Brazilian farmers may have to reevaluate their safrinha corn acreage intensions if the planting is significantly delayed as expected.