Brazilian Farmers Reducing Corn Acreage due to Low Prices
Oct. 21, 2013
The corn yield for 2013/14 is estimated at 81 sacks per hectare (4,860 kg/ha or 75 bu/ac), which would be a decline of 20% compared to the 101 sacks per hectare achieved in 2012/13 (6,060 kg/ha or 93 bu/ac). The decline in the estimated yield is attributed to reduce use of fertilizers and the planting of less expensive hybrids, which could also be lower yielding. Imea feels the reduced corn acreage will be switched to increased cotton and sunflower acreage.
Last growing season a record 47% of the soybeans in the state were followed by a second crop of corn and that is expected to decline 6% in 2013/14 to 41%.
The reduced interest in safrinha corn production in the state is the result of very low corn prices being paid for the 2012/13 corn production. The prices paid for corn in Mato Grosso continue to be below the cost of production. In Sorriso, which the municipality with the largest corn acreage in the state, the prices paid for corn this week were in the range of R$ 8.20 to R$ 9.40 per sack (approximately US$ 1.70 to 1.95 per bushel). The cost of production in Sorriso is estimated at about R$ 13.20 per sack (approximately US$ 2.75 per bushel).
Parana is the second largest corn producer, and while the corn economics is not as dire as it is in Mato Grosso, it is still not favorable and as a result, the corn acreage in the state is expected to decline. The prices being paid for corn in Parana are in the range of R$ 16.50 to R$ 17.50 per sack (approximately US$ 3.40 to 3.60 per bushel). The current prices are below what Conab considers the cost of production in Parana at R$ 20.41 (approximately US$ 4.21 per bushel) and the guaranteed minimum set by the government at R$ 17.67 per sack (approximately US$ 3.65 per bushel).
The Secretary of Agriculture for the state of Parana estimates that the 2013/14 full-season corn acreage in the state will decline by 20% to 699,000 hectares. They have not yet estimated the 2013/14 safrinha corn acreage in the state, but it too is expected to decline as well. In 2012/13, farmers in the state planted 2.17 million acres of safrinha corn (71% of the total corn acreage in the state) and 878,000 hectares of full-season corn (29% of the total corn acreage in the state).
Farm organizations in Parana are asking the federal government to include the state in the various programs used to support corn prices in Brazil and to help pay for transporting the corn to export markets.
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