Cepea, May 5, 2020 – The trading pace for corn was slow in the Brazilian market in April, due to the absence of purchasers in the market, which pressed down quotes in many regions. Amid uncertainties related to the effects of the covid-19 pandemic worldwide, purchasers left the market, mainly those from the livestock sector.
In this context, many agents were focused on crops. In central-western Brazil, the weather was favorable to the development of the second crop. In Mato Grosso, despite the problems early in the season, the 2019/20 harvest should be a record. In southern and southeastern Brazil, the harvesting of the summer crop was ending in late April, and the second crop was developing well. Still, Cepea collaborators are worried about the lack of rains in the southern regions that produce second crop corn.
Late in the month, the downward trend of corn prices lost strength. With irregular rains and the possible effects on the productivity of the second crop, many growers reduced supply in the spot market, increasing asking prices. However, as international prices were dropping and purchasers were cautious about closing new deals, prices did not rise in Brazil.
Until the end of April, official bodies were pointing to a record second crop in Brazil, but estimates may be revised, since the weather has been unfavorable – Conab (Brazil’s National Company for Food Supply) forecasts the second crop to total 75.43 million tons.
PRICES – Between March 31 and April 30, the ESALQ/BM&FBovespa Index for corn (Campinas, SP) dropped by a steep 19.6%, to 48.35 BRL (8.88 USD) per 60-kilo bag on April 30.
EXPORTS – With warehouses full of soybean, the number of corn deals for exports was low in the Brazilian spot market in April. Besides, despite the devaluations along the month, prices were more attractive in the interior of the country than at ports.