Marketeye-Brazil February 17

[marketeye]

Yesterday, the reporters on the Crop Expedition had a sit-down with Brazil's Minister of Agriculture, 

Wagner Rossi. Just as he told us he supports a planting extension date for the second corn crop 'Safrihina', the government announced later that same day a 20-day extension. The second crop will be larger than the summer corn crop.

On storage issues, Minister Rossi says this is a problem the private sector and the farmers should solve themselves. On-farm storage is not used a lot because farmers can't afford a 16% financing rate. Rossi says the government is helping with financing, especially, in the areas that are trying to build infrastructure. But, he adds, the farmers should pay for storage themselves.

A cooperative group told us that Minister Rossi is wrong on this issue. They totally disagree.

I asked the Minister about the role of foreign investment in Brazil. He says individual farmers and farm groups are welcome, but the big funds that are trying to invest are not. A new document is being developed to spell this out. He thinks the new law restricting foreign investment is being misunderstood.

I was also told Brazilian and U.S. farmers share a common characteristic, growing the crop comes a lot easier than marketing the crop. However, the farmers are selling forward more and more, taking advantage of high prices.

A lot of Brazilian farmers are 60% sold on new-crop and are starting to price 2012 crops.

Thanks,

Mike

[k-289]

I find the 16% financing rate an interesting number--which would probably halt storage in its tracks here .

[teaspoon73]

       Would that second corn crop be big enough to export? When would that come to harvest?

[floydboy]

The second crop corn would be bigger than the summer crop???

In year's past, the second crop accounted for only 5-10% of the total Brazilian corn crop.

Are things changing that much?

[oncearound]

that claim of 2nd crop being larger is bogus! just like the minister said the foreign investment law is being misunderstood by outsiders, well he must be an outsider of what is going on with crop size in Brazil! something must have been lost in the translation on that point???

[LuanaGomes]

Dear Oncearound, If you don’t mind me asking, I’d like to know where you are getting your info. I’m a Brazilian reporter, specialized in agribusiness, and I just got back from a very long trip throughout the Brazilian countryside, as I do several times every year. And I can absolutely guarantee you that the safrinha corn crop will be larger this year and that the ag minister does know exactly what he is talking about.

There were, however, some things that did get lost in the translation. First, the financing rate for storage facilities can be as high as 12% in Brazil, and not 16%. One way or the other, that rate is too expensive for Brazilian farmers, given the farm sizes and income down here. About the bottleneck harvest problems, what the minister said is that those issues should be solved in cooperation between government and farmers. The government’s role, he said, is to provide farmers with enough money so they can build silos and bins themselves, to make sure the roads are in a good condition and that we develop our railroads and river transportation system.

Floydboy, you are right when you say the safrinha crop is not bigger than the summer corn crop. But the second crop is getting larger almost by the minute here in Brazil and it will probably surpass the summer production in the next few years. Since 2002/03, it accounts to over 20% of the total Brazilian corn production – last year it was 40%.

Teaspoon73, yes, with favorable weather during our winter, the total corn production in Brazil will be big enough to export, as the total Brazilian production of 55mmt is bigger than our domestic corn consumption of 47mmt. The safrinha crop will be harvested between May and October, depending on the region.

I’m sorry if I sounded a little rough. That was never my intention. I just thought I’d clear some misunderstandings out. Let me know if you guys have any further questions

LG

[jrsiajdranch]

LuanaGomes, thanks for your insight here. Please check in anytime. Not to tooot my own horn here but if you go to my profile you can see some pics of last years farm work.  Thanks for keeping an eye on Marketeye! HE HE

[Canuck_2]

LuanaGomes thanks for your input.

It always helps to get the story direct, cuts out a lot of mistakes in retelling it.

Your double cropping of corn behind soys is not new I have been shown pictures 15 years ago of corn being planted directly behind the combines.

Note the plural combines since there were 20 some combines going down the field and a similar number of corn planters following, with a line of trucks waiting on the road to be filled.

I always remember those pictures as they showed just how big farming was in Brazil and the arial shots showed nothing but soybeans on and on.

If I am able to find those pics I will post so everyone can see them. 

[oncearound]

Luana Gomes: if you noticed, my reply was directly below "Floydboy"s post which contained his question of  "The second crop corn would be bigger than the summer crop???" a question i would think he made in jest, knowing his background?

my statement that you question......."that claim of 2nd crop being larger is bogus!"...............was directed at Floydboy's question. A question you then reply to with the following............"Floydboy, you are right when you say the safrinha crop is not bigger than the summer corn crop"......

so, you and i are actually in agreement.

[LuanaGomes]

Ops, I guess it was my bad then, Oncearound. I’ll tell you what, let’s go ahead and blame that on the translation too. Hehe. But I apologize for that 😉

I wanted to rectify the information because I was there on that interview with the ag minister and what he actually said is that the safrinha corn acreage will go up this year, and not that the production is larger than the summer corn crop. As I said before, it will probably surpass the summer production in the next few years. It’s just a matter of time before that happens. Not only because your yield are getting better, but also because the safrinha corn is getting more and more space in the Brazilian new frontiers. Marketeye saw it for himself, places like Nova Santa Rosa, in The Uruçui’s plateau, Piaui state, that two years ago grew only soybeans are now hushing the summer crop to double crop. And they are getting good results on the safrinha corn too -- last year it averaged 143 bu/acre there, way above our national average of 72 bu/acre.

Please forgive me if what I’m telling you is old news. I just think we need to tell it how it really is. That is actually one of the reasons we, the Gazeta do Povo’s Crop Expedition, invited Marketeye to come and visit. As the ag world gets more and more globalized, having reliable information is the key to success. At least that is the way I see it.

Jrsiajdranch, don’t you worry. I’ll keep a close eye on Marketeye. Hehe. But he actually did a terrific job while here and I’m sure he still have a lot to tell you guys about the trip.

Canuck_2, thanks for the reply. I’m glad to hear you already know all about our double cropping. I’ll definitely try to check in more often to keep you guys updated on the newest and hottest info on Brazilian ag.

Take care

LG