Possible record crop presses down quotes in Brazil in June

Cepea, July 2, 2020 – Corn prices dropped in the Brazilian market in June, influenced by the pressure from purchasers, who are attentive to the second crop harvesting. Despite the sowing delay in some regions, the weather favored the end of crops development, which tends to boost productivity and result in a record output.

 

Data from Conab (Brazil’s National Company for Food Supply) released in the first fortnight of the month estimated corn production to total 100.99 million tons, 0.9% up compared to that in the previous season and a record. In this scenario, purchasers bought sporadic corn batches in June, waiting for the harvesting to step up in July.

 

At Brazilian ports, the dollar depreciation against Real until June 25 and soybean shipments, which were prioritized in June, limited corn exports, helping to press down quotes in Brazil. In this scenario, between May 29 and June 30, the ESALQ/BM&FBovespa Index for corn (Campinas, SP) decreased by 3.31%, closing at 48.53 BRL (8.92 USD) per 60-kilo bag on June 30. In June, the Index averaged 47.75 BRL in Campinas, 4.7% down compared to that in May.

 

CROPS – The weather favored corn harvesting in Mato Grosso State in June. According to Imea, until June 19, activities had reached 16.35% of the area estimated for the state. In Paraná, until June 22, the harvesting had reached 4% of the area estimated for the state, according to data from Deral/Seab.

 

In São Paulo, the harvesting started in the Mogiana region, but the volume available until the end of June was still low. In Goiás and in the Triângulo Mineiro, activities advanced more, but the first batches were allocated to the accomplishment of contracts. In northeastern Brazil, the harvesting was interrupted by rains, and sellers prioritized the delivery of batches already marketed.

 

(Cepea-Brazil)

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