World Grain - June 2018 - 32
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Brazilian corn crop to drop
10% from record high
Following record corn production of 98.5 million tonnes
in 2016-17, Brazil's production is forecast down 10%
in the new crop year as total area is reduced and yields
return to average, according to a report from the Foreign
Agricultural Service (FAS) of the U.S. Department of
Production in 2017-18 is estimated at 89 million
tonnes, with a reduced area for first- and second-crop
corn. Overall crop area has decreased to an estimated
16.4 million hectares, with significant decreases in firstcrop corn and smaller decreases in second-crop. About
70% of Brazil's total harvest now comes from secondcrop safrinha corn, according to Brazil's National Food
Supply Company (CONAB).
First-crop corn area has shrunk in the last decade as
higher soy prices encouraged farmers to plant corn only
as a second crop after soy. CONAB reported an 8.9%
reduction in first-crop corn area, the smallest in 40 years.
Reductions were seen in some of the largest
producing states, including Rio Grande do Sul, down by
9.5%; Minas Gerais, down by 11.5%; Santa Catarina,
down by 19.9%; and Parana, down by 34.4%.
Second-crop corn is also down, partly due to delays in
soybean planting in Mato Grosso due to dry weather. This
delayed early soybean harvest, which narrowed the ideal
window for planting second-crop corn, the FAS said.
Many farmers don't see a downside in planting
outside of that window because government support
programs will guarantee a minimum price, the FAS said.
Exports for 2017-18 are forecast slightly lower to 33
million tonnes, reflecting the lower production forecast.
The largest export market is Iran, which received about
16.5% of Brazil's corn exports in 2017. Brazil's corn
imports are negligible, with small amounts coming from
Paraguay and Argentina to supply livestock operations
in the southern part of the country, the FAS said.
Most of Brazil's first-crop corn is used domestically for
poultry and livestock while a large portion of the secondcrop traditionally has been exported. But with large
corn stocks from 2016-17, low prices and expansion
of corn production, the door has been opened for nontraditional types of consumption, the FAS said.
FS Bioenergia is operating an ethanol plant using
corn as a feedstock. It reached full production capacity
within three months of opening and is now undergoing
an expansion that will bring total ethanol production to
140 million gallons per year and corn consumption to
1.26 million tonnes.
It recently announced plans to build a second plant
in Sorriso, Mato Grasso, that will produce 180 million
gallons per year and process 1.8 million tonnes of corn.
June 2018 / World Grain / www.World-Grain.com