High prices support growth in off-season corn area in Brazil

Even with the delay in soybean planting raising doubts about the ability to plant the 2020/21 winter corn crop within the ideal window, an area 8,5% larger than that observed this year is expected, according to a review from StoneX consultancy.

“The prospects of strong demand, both internal and external, for the grain, and the high prices of the commodity continue to support expectations for strong growth in the area, despite concerns about potential climate issues,” he stated in a report.

The group slightly increased its production estimate, by 41 thousand tons, to 82,4 million tons, reflecting the marginal increase in the planted areas in Tocantins and Pará.

Considering the production estimates for the first and second harvest, estimated by StoneX, added to the number for the third harvest from Conab, at 1,64 million tons, we arrive at a total production of 109,34 million tons, which , if confirmed, would still represent a record.

“A record production could give room for slightly larger stocks, at 13,8 million tons, if demand is not surprising. China still does not purchase commercial volumes of corn from Brazil, but this is a point to be monitored, since the Asian country is purchasing high volumes from the USA”, he explains.

Summer harvest cutting

For the first 2020/21 corn harvest, StoneX brought a new cut to production, which went from 27,1 to 25,3 million tons, below the volume obtained in the 2019/20 season, when the country harvested 26,2 .XNUMX million tons.

The prospect of lower performance results mainly from a contraction in national productivity, which fell from 6,42 to 6,01 tons per hectare. The lower yield is mainly due to the decrease in production potential in Rio Grande do Sul and Santa Catarina. “The south of the country has been facing a drier climate, which has penalized the development of grain in the region,” explained the group. In addition to the prospect of lower productivity, it is worth highlighting that the number of planted areas in Rio Grande do Sul and Santa Catarina were slightly reduced.

On the other hand, it is important to highlight that the numbers for Pará and MATOPIBA were revised upwards, reflecting both an advance in the estimates of planted area and productivity.

Total corn production includes estimates for the first and second harvests, in addition to the Conab number for the third harvest.