Jun 22, 2020
Brazil Already Committed to 26-28 Million Tons of Corn Exports
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
Brazilian farmers are being advised to pay close attention to the exchange rate between the Brazilian real and the U.S. dollar as well as the weather in the United States in order to determine when and how much of their remaining corn crop they should sell.
Since the start of the export season on February 1st, Brazil has exported 900,000 tons of corn compared to 4 million tons during the same period in 2019. The lower volume this year is due to the later planting of the safrinha corn compared to last year, which was record fast planting. Additionally, record high soybean exports over the past four months have occupied nearly all the space at Brazilian ports, thus limiting corn exports.
According to the analysts from the trading firm Germinar Corretora, Roberto Carlos Rafael, Brazil has already committed to exporting 26 to 28 million tons of corn until the end of the harvest year which is January 31, 2021. Export commitments slowed down the last several weeks when the Brazilian currency strengthened compared to the dollar, but the currency has started to weaken once again and as a result, commitments have started to pick up. The Brazilian currency ended trading last Friday at 5.32 to the dollar.
In an interview with Noticias Agricolas, Rafael estimated that Brazil will eventually export 34 million tons of corn, but the final amount will be determined by the currency exchange rate and the price of corn on the Chicago Board of Trade. If the summer weather in the U.S. is favorable and the corn crop develops without any major problems, international corn prices should weaken putting pressure on Brazilian corn prices as well.
The safrinha corn crop in Brazil is approximately 8% harvested and there is a very wide range in the estimates for the 2019/20 Brazilian corn crop from a high of 108.4 million tons to a low of 96.4 million tons.