Jun 20, 2019

Corn Harvest in Full Swing in Brazil, Record Production Expected

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

The safrinha corn harvest is in full swing in Brazil and long lines of trucks waiting to unload corn at the local grain elevators is a good indication of what is expected to be a record large safrinha corn crop. Nationwide, the safrinha corn is approximately 10% harvested with 15% harvested in Mato Grosso and 13% harvested in Parana.

In the municipality of Toledo, which is located in western Parana, there are reports of trucks lined up for a kilometer waiting to unload corn with some waiting up to two days. At other locations the lines are more dispersed with trucks waiting at the local truck stop or other locations. One cooperative in Toledo said they receive about 110 trucks per day with each carrying about 30 tons of corn and it is a challenge to find a place to put the corn.

Safrinha corn yields in Parana are better than originally expected due to the good late season rains as the crop was filling grain. Rabobank is estimating the 2019 safrinha corn production in Brazil at 70.4 million tons, which is 5% more than the previous record. They are estimating Brazil's total corn crop at 97.4 million tons, or more than 20% more than last year. The USDA is even more optimistic estimating the Brazilian corn crop at 101.0 million tons

In Mato Grosso, which is the largest safrinha producing state, farmers are reporting record corn yields and grain elevators are going to pile the corn outside due to a lack of storage space. There is not much danger storing the corn outside in Mato Grosso this time of the year because this is the dry season. The corn will have to be picked up before the onset of the summer rains, which usually start sometime in September.

The record corn crop is putting pressure on domestic prices that had been rising in conjunction with rising corn prices in the United States resulting from a historically slow planting season. Once the harvest pressure eases, domestic corn prices are expected to move higher especially if the corn crop in the U.S. ends up as disappointing as some analysts are expecting.

For independent truckers in Brazil, the record corn crop means more demand for trucks, but the long wait times to unload eats into their profit margins.