Sep 26, 2015
Brazilian Farmers ask for Increase in Minimum Price of Corn
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
It is costing Brazilian farmers a lot more to produce their corn and soybeans in 2015/16, so therefore, farm groups are petitioning the Brazilian Minister of Agriculture to increase the minimum price for corn guaranteed by the government. Currently, Conab has the minimum price guarantee for corn in Mato Grosso set at R$ 13.56 per sack of 60 kilograms and the farm groups would like to see it increased to R$ 17.39 per sack.
The Agriculture and Livestock Federation of Mato Grosso (Famato) claims the increase is necessary just to cover the increased cost of production and the logistical challenges in the state. Famato estimates that the cost of producing corn in Mato Grosso is R$ 22.14 per sack.
Currently, the prices being offered for corn in the state are satisfactory, but producers are worried about future currency fluctuations which could lower the domestic price of corn. Additionally, credit is tight and expensive in Brazil and financial institutions look at the minimum prices as one factor that could influence their credit decisions.
The groups are hoping for a positive response from the Minister as soon as possible in order to increase the minimum price for the full-season corn that is currently being planted and the safrinha corn that will be planted next January, February, and March.