Oct. 11, 2017
Brazilian farmers will likely produce a smaller amount of corn and soy in 2017-18 due to less favourable weather than the prior crop year, food supply and statistics agency Conab said on Tuesday.
In its first forecast for the 2017-18 crop, Conab estimated Brazilian total grain production at between 224.1 million tonnes and 228.2 million tonnes, compared with 238.5 million tonnes in the prior cycle. The lower end of the range would represent a six percent drop in output.
The agency predicted Brazil’s soy output at between 106 million tonnes and 108.2 million tonnes in the 2017-18 period, down from 114 million tonnes last year. Conab’s outlook is similar to USDA’s forecast of 107 million tonnes.
Conab said total corn output will range between 92.2 million tonnes and 93.6 million tonnes in 2017-18, down from 97.8 million tonnes in 2016-17. USDA’s forecast is 95 million.
“The highly favourable climate conditions that contributed to a record grain output last season are unlikely to be repeated,” Conab said in a statement.
Soy and corn will account for about 89 percent of Brazil’s grains output.
The government now expects soybean area to increase by 2.7 percent from last yaet to 87 million acres.
“Soy has been offering higher liquidity and yield prospects compared with other crops,” Conab said.
At the same time, the corn area planted in the summer may drop by about 10 percent as more farmers decide to replace lower priced corn with soy crops, Conab said.
“Next year’s first and second corn crop will be economically viable with reasonable prices … giving a minimum remuneration so the producer can make new investments,” Neri Geller, secretary for agricultural policy at the Ministry of Agriculture, told reporters following the release of Conab’s forecast.
Conab forecast that total grain planting area will be stable or grow by up to 1.8 percent from the prior crop year, with soy and cotton planting contributing to the expansion.
Dry weather has slowed grain planting in Brazil early in the season.
Through Oct. 5, farmers had sowed only five percent of the soy area, compared with 11 percent at the same time a year ago but in line with a five-year average of six percent.
“We have had some problems especially in the Center-West where rains were significantly late,” Geller said.