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March 6, 2013

Farmers in Parana to Plant 6% More Wheat in 2013

As farmers in the state of Parana harvest their first crop of soybeans, they must decide which crop to plant for the remainder of the growing season and over the Brazilian winter. For the last several years, farmers have opted for more safrinha corn and less wheat acreage. The 2011/12 wheat acreage in Parana was the lowest in ten years. Domestic wheat prices are now 70% higher than a year ago and as a result, farmers will probably increase their wheat acreage in 2013.

In their first assessment of the 2013 wheat crop, the Department of Rural Economics (Deral) is estimating that wheat acreage in Parana will increase 6% from 778,000 hectares planted in 2012 to 825,000 hectares planted in 2013. Even with this increase, the acreage will still be less than the 1,100,000 hectares that it averaged between 2000 and 2009.

While the international wheat price has increased approximately15% over the past year, the domestic price of wheat in Brazil has increased much more due to very tight supplies. A year ago wheat was selling in Parana for R$ 23.43 a sack of 60 kilograms which was considered by the farmers to be below the cost of production. During February of 2013, the same sack was selling for R$ 39.84. In 2011/12 Brazil produced 41% of the wheat consumed within the country, which was less than the previous four years that averaged 50%.