Feb 22, 2021

Brazilian Farmers Expected to Increase 2021 Winter Wheat Acreage

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

Farmers in southern Brazil will start planting their winter wheat after the first crop of soybeans are harvested. Winter wheat is planted in areas of southern Brazil where the weather is too cold for a second crop of corn of if the corn would be planted after about mid-March.

The state of Parana is the most important wheat producing state in Brazil and most of the wheat in the state is planted in the southern and eastern regions of the state. Rio Grande do Sul is the second most important wheat producing state and wheat is the principal second crop in the state. Those two states produce about 90% of Brazil's wheat.

The consulting firm TF Agroeconomica is estimating that Brazil's 2021 wheat acreage will increase due to the delayed planting of safrinha corn. They estimate that farmers in Parana will increase wheat acreage 10% to 1.23 million hectares (3.03 million acres). If the wheat yields average 2,950 kg/ha (44 bu/ac), the state would produce 3.63 million tons, which would be an increase of 20% compared to last year.

In Rio Grande do Sul, Conab is estimating the 2021 wheat production at 2.5 million tons, which would be up 10.6% compared to last year which was negatively impacted by dry weather.

TF Agroeconomica is estimating that the average domestic price of wheat during the second semester of 2021 will be R$ 60 per sack (approximately $5.15 per bushel), which would be down 20% compared to the R$ 75.25 per sack during the second semester of 2020 (approximately $6.45 per bushel). Even with the reduced price, wheat farmers in southern Brazil could still turn a profit of approximately 17% on their 2021 wheat production.

Brazilian farmers can produce only about half of the wheat needed for domestic consumption with most of the reaming wheat imported from neighboring Argentina.