Dec 23, 2009
Brazilian Corn Exports In 2009 Surpasses 2008 Especially To The Middle East
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
The corn crop in Parana is developing quite well and farmers are expecting very good yields from their full-season corn crop. Conab is estimating that the farmers in the state will produce 6.4 million tons of full-season corn. Even though the farmers in Parana cut back on their full-season corn acreage by 27% compared to last year, the total production is estimated to be only slightly less than last year's drought affected crop. If that turns out to be true, then Brazil will continue to have a lot of corn to export and Brazil's corn exports will need to increase in order to avoid having an even larger corn carry over than last year.
During the January-November 2009 period, Brazil exported 6.54 million tons of corn compared to 6.4 million tons last year at the same time, but Brazil needs to stimulate corn exports even more in order to work down the high domestic stocks of corn. Since mid-August, the domestic price of corn in the center-west region of Brazil has been below the guaranteed minimum price set by the government, which was higher than the prices exporters were willing to pay. The farmers therefore wanted to sell their corn to the government instead of exporters with the government picking up the difference. According to Jose Cicero Aderaldo, Commercial Director of Cocamar which is the second largest co-op in Parana, that is exactly what the government has been doing through a program called Pepe where the government absorbs the price difference between the domestic market and the export market.
Brazilian corn exports receipts from countries in the Middle East have more than doubled thus far in 2009 compared to the same period in 2008. During the January to November period, Brazil sold US$ 236 million worth of corn to countries in the Middle East compared to US$ 119 during the same period in 2008. The number one buyer of Brazilian corn in the region is Saudi Arabia followed by Morocco, Algeria, and the United Arab Emeritus. In volume, Brazil exported 1.5 million tons of corn to the Middle East thus far during 2009 (January to November) compared to 0.55 million tons during the same period in 2008.