Dec. 20, 2018
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
The dry weather in southern Brazil is also impacting the full-season corn as well. Much of the full season corn in southern Brazil is now pollinating and starting to fill grain. As of a week ago, the corn in Parana was 32% pollinating and 18% filling grain. The Department of Rural Economics in the state was still rating the corn at 6% average and 94% good, but that was down slightly from the prior week and before the hot and dry weather of last week. I expect the conditions to decline when they issue their next report.
As a result, I think the estimates for the full-season corn crop may start to decline especially if the dry weather pattern persists in the state of Minas Gerais, which has the most hectares of full-season corn at 773,700. In a close second is Rio Grande do Sul with 753,900 followed by Parana with 348,500 hectares. I think the corn in Rio Grande do Sul should be OK, so the potential problem could be in Parana and eventually Minas Gerais, which planted the corn last.
The situation for the safrinha corn is somewhat undetermined. When the Brazilian judge decided to suspend fines for not paying the minimum freight rate, I thought it was good news for the safrinha corn because it would lower fertilizer cost and farmers could be paid more for their corn. Surprisingly, that decision has now been reversed and the fines have been reinstated.
My guess is that the freight rate issue will not be resolved any time soon, so the high costs of transporting fertilizers will still be in pace when farmers start planting their safrinha corn. Hopefully, the freight rate issue will be resolved by the time they start to harvest the safrinha corn in late May or June.
Additionally, the forecast for the safrinha growing season from January to June is now a little worrisome, so it makes the entire safrinha corn situation somewhat uncertain.