Nearness of the harvesting presses down values in the Brazilian spot market

Cepea, June 16, 2021 – With the nearness of the harvesting of the second 2020/21 crop, corn prices dropped in the spot market of most Brazilian regions surveyed by Cepea in the first fortnight of June.


Purchasers were postponing deals, expecting prices to decrease more as the harvesting advances. Sellers were cautious about making large volumes available in the market, since inventories are low and many of them are still uncertain about crops productivity. In that scenario, liquidity was low in Brazil in the first half of the month.


In São Paulo State, purchasers put pressure on values, and the ESALQ/BM&FBovespa Index for corn (Campinas) dropped by 6.8% between May 31 and June 15, closing at 93.27 BRL (18.50 USD)/60-kilo bag on June 15.


CONAB – Data released by Conab (Brazil’s National Company for Food Supply) on June 10 confirmed a decrease in corn production in the second 2020/21 season, by 6.8% compared to that last season, to 69.9 million tons – 9.8 million tons less than that estimated in May. This result is linked to the lower productivity of crops, which is 14% below that last season, considering the national average. The major reason for the lower productivity is the water deficit in most corn-producing regions in Brazil.


As for production in the third crop, Conab revised down estimates to 1.7 million tons, 6.9% down from that last year. This result is linked to the 8.9% decrease in the average productivity of Brazilian corn crops.


Considering initial inventories + production, corn supply in the 2020/21 season is estimated at 109 million tons. Consumption estimates were not changed, still forecast at 72.15 million tons. With perspectives for lower supply, Conab revised down exports estimates to 29.5 million tons, 5.5 million tons down from that estimated in May. Imports are now estimated at 2.3 million tons, 1.3 million tons up from that forecast in May. Thus, by the end of the season, inventories are predicted to be at 7.6 million tons, 28% lower than that last season.


CROPS – In Paraná, the harvesting of the second crop has begun, and, until June 7, 1% of the state area had been harvested, according to Seab/Deral. As for crops conditions, only 22% of them were good; 46%, average; and 32%, bad, reflecting the drought during crops development.


In Rio Grande do Sul, the harvesting of the first crop is ending. According to Emater/RS, 95% of the area had been harvested until June 10.


In Mato Grosso do Sul, Famasul estimates corn production to total 9 million tons, 4% up from that in the 2019/20 season. As for crops conditions, 59% were in regular conditions in the first half of June; 35%, in bad conditions; and 6%, in good conditions.




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