Brazil lowers corn production forecast because of dry weather in the south

Brazil's corn production forecast for 2020-21 has been cut to 102.6 million mt from 104.9 million mt projected in November, Brazil's national agricultural agency, Companhia Nacional de Abastecimento (Conab), said in its latest forecast.

Conab said that dry weather condition in the southern region of the country has hurt sowing operations and crop development. Moreover, in some regions farmers have opted for soybean instead of corn, which has brought down the planted area of the first corn crop.

First corn production in Brazil is pegged at 24.2 million mt, down 8.7% from the last month's estimate and down 5.8% from last year, while the forecast for the second corn crop was kept unchanged at 76.76 million mt, up 2.3% year on year, the report showed.

The first corn crop in Brazil is planted from September-December and harvested from February-May, while the second crop is planted in February-March and harvested in June-July.

Brazil's corn production in 2019-20 totaled 102.5 million mt.

Brazil's corn area in 2020-21 is projected at 18.44 million hectares, down 0.5% year on year, while corn yield is seen at 5.56 mt/ha, up 0.6%, Conab said in the report.

Brazil's corn exports in 2020-21 (February 2021-January 2022) are forecast at 35 million mt, unchanged from the November forecast and only 0.5 million mt higher than the level projected for 2019-20, as domestic demand is seen as robust.

Brazil is likely to consume 71.83 million mt of corn in 2020-21, an increase of 4.6% from the estimated consumption level in 2019-20, the report said.

With robust consumption and external demand, Brazil's ending corn stock levels in 2020-21 are forecast to fall to 7.4 million mt, down 30.3% year on year and the lowest since 2015-16, according to Conab.

Brazil is the second-largest exporter of corn in the world following the US.