Brazilian corn exports should determine the domestic prices in the 2006/07 crop. For a while, the ESALQ/BM&F Index accumulates an increase of 0.94 in this month, averaging 11.69 dollars per bag of 60 kilos this Tuesday, Jan 24.
Brazil should increase its corn exports in the 2006/07 crop, due to the larger production estimated for the summer crop and the perspective of higher winter crop.
The larger summer crop production should come from the higher productivity, especially in the Southern region (main corn producer in Brazil). Comparing the last two reports published by the National Company for Food Supply (Conab), the average productivity was enlarged from 3,552 to 3,575 kilos per hectare. The summer corn crop production is estimated now at 34.01 million tons, 6.9 percent higher than the previous crop.
The international market keeps being the highlight of the moment. Corn price at the Chicago Mercantile Exchange (CBOT) reached more than 4.00 dollars per bushel last Wednesday, the highest value since July of 1996 - the maximum level in more than ten years. The reason was the USDA report from January, which reduced the North-American production and the final stocks estimated in the 2006/07 crop.