Reply
Senior Contributor
Posts: 407
Registered: ‎04-24-2012
0

Brazil's corn acres cut will be really big

Hello boys,

 

As it has been anticipated by this website, Brazilian farmers are ready to cut corn acres. A lot of analysts disagree that the surface reduction for the summer crop will not be by 50% as opined the director of the Brazilian Association of Corn Growers. But most see that the cuts will be significant.

 

Agroconsult, a credible private consultancy, believes, for instance, that the summer crop in Brazil will shrink from 30 million metric tons in 2016 to 26.1 million metric tons. That is 14% less and almost four million metric tons of reduction. It is a lot! Let's remind that the planting is about to start in a couple of days. The Paraná agricultural agency foresees a surface reduction of nearly 20% in the state.

 

A big point is that the surface planted will not be the only issue here. Meteorologists say a stronger La Niña is coming. For Rio Grande do Sul, which is the last state to plant corn in the country (December), the Rural Institute of Technical Assistance expects a crop reduction of about 24%.

 

Antonio da Luz, chief-economist of the Federation of Agriculture and Livestock of Rio Grande do Sul, is skeptical of most early projections and spoke to me the following statement:

 

"Agronomists making projections several months before planting time usually get it wrong. The metric should be economic and very close to planting. After planting, then agronomists come with the most accurate estimates. I just can say now that the weather is forecast not to be exceptional as 2016, but will be normal. I'm not sure that farmers will shrink so many acres," said Luz.

Highlighted
Veteran Advisor
Posts: 951
Registered: ‎10-18-2016
0

Re: Brazil's corn acres cut will be really big

The US Climate Prediction Center calls for ENSO neutral for the balance of the year.  Is the thinking that El Nino will increase in 2018?

 

Is the reason for the reduction mostly prices?  

Senior Contributor
Posts: 407
Registered: ‎04-24-2012
0

Re: Brazil's corn acres cut will be really big

JimMeade,

 

Yes, the reason is mostly prices. In some cases, the domestic freight costs nearly doubles cash paid to producer, so they are fearful to plant. And there is a strong La Niña forecast, not El Niño.