With disinterested purchasers, corn prices drop in Brazil

Cepea, September 16, 2020 – Corn prices dropped in most Brazilian regions surveyed by Cepea in the first fortnight of September, influenced by the lower demand from purchasers, who claimed to have inventories enough for the short term.

 

In Campinas (SP), the ESALQ/BM&FBovestpa Index for corn dropped by 3.7% between August 31 and September 15, to 58.97 BRL per 60-kilo bag on September 15.

 

As regards Brazilian corn exports, in the first four working days of September, Brazil shipped 1.89 million tons of corn, with a daily average of shipments at 472.69 thousand tons, according to data from Secex (Foreign Trade Secretariat). If this pace continues until the end of the month, exports in September may near 10 million tons, a record for the month.

 

This season (Feb/20 to Aug/20), Brazil has exported 12 million tons. So far, Conab (Brazil’s National Company for Food Supply) has estimated shipments to reach 34.5 million tons until January 2021.

 

On September 10, Conab forecast the Brazilian corn output in the 2019/20 season to total 102.5 million tons, 400 thousand tons up compared to that from August and 2.5% higher than that in 2018/19.

 

Considering ending stocks in the 2019/20 season (10.18 million tons), imports (900 thousand tons), domestic consumption (68.66 thousand tons) and exports (34.5 million tons), ending stocks in the 2020/21 season would total 10.43 million tons (in January 2021). This volume accounts for only 56 days of consumption in Brazil from February onwards.

 

CROPS – Brazilian corn farmers are, again, watching the weather, since the drought may hamper soybean sowing in October and delay corn sowing (second crop 2020/21). In southern Brazil, the lack of rains is concerning agents about the development of the summer crop.

 

In general, by the end of the first fortnight, the harvesting was ending in São Paulo, Mato Grosso do Sul, Goiás and Paraná. In Paraná, activities had reached, until Sept. 8, 89% of the state area, according to Seab/Deral. In Mato Grosso do Sul, the harvesting had reached 77.4% until Sept. 8, according to Famasul.

 

For the summer crop, however, Emater estimates that Rio Grande do Sul will produce 5.93 million tons of corn, 43% more than that in the previous season. Sowing is advancing in the state, except in Porto Alegre, where rains were high in the first half of September. In Paraná, 16% of the area has been sown (Seab/Deral).

 

(Cepea-Brazil)

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