Aug 25, 2021

Potential Brazil Corn and Soybean Production in 2021/22

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

Farmers in Brazil are preparing to plant their 2021/22 crops, so let's take an early look at the potential acreage and production. These are very preliminary estimates and given the volatility in the weather and the commodity markets, one thing is certain - these estimates will probably be adjusted going forward.

Brazil 2021/22 Weather - It is currently hot and dry in most of central Brazil with very low relatively humidity and temperatures as high as 40°C (104°F) forecasted for Mato Grosso and Mato Grosso do Sul. There may be a few light rains in parts of central Brazil over the next 1-2 weeks, but no heavy rain is forecasted until sometime in September. The only recent rains have been confined to far southern Rio Grande do Sul. The Brazilian National Weather Service (Inmet) is forecasting below normal precipitation for August-September-October across most of central Brazil.

Brazil 2021/22 Corn

Brazilian farmers may start planting their full-season corn any time they wish after August 1st. A little full-season corn has been planted in Rio Grande do Sul and Santa Catarina, which is not unusual at this time of the year.

Brazil's full-season corn acreage may increase a little this year as farmers take advantage of very strong domestic corn prices. Local livestock producers are offering attractive forward contracts trying to entice farmers to plant more full-season corn, but full-season corn only accounts for about a quarter of Brazil's corn production. Full-season corn acreage in Brazil may increase 2-4% in 2021/22.

Three quarters of Brazil's corn is safrinha production, which is planted after soybeans are harvested. Given the strong domestic corn prices, Brazilian farmers will be anxious to plant more safrinha corn if they are able to plant their safrinha corn before the ideal planting window closes at the end of February. If they plant their soybeans on time and if it is not excessively wet during the soybean harvest, the safrinha corn acreage may increase 5-7% in 2021/22.

The USDA is estimating that Brazil's corn acreage will increase in 2021/22 by 1.0 million hectares to 20.8 million, or an increase of 5%. The USDA is estimating that Brazil's corn production will rebound from 87.0 million tons in 2020/21 to 118.0 million in 2021/22. If verified, that would be a 31 million tons increase. The increase could be even more than that because I think their 87.0 million tons estimate for 2020/21 is too high. I am estimating the 2020/21 Brazilian corn crop at 84.0 million tons.

All these estimates are premised on "normal" weather, but the weather may be problematic this growing season given to potential for a reemergence of La Nina conditions in the Pacific Ocean (see later article).

Brazil 2021/22 Soybeans

Brazilian farmers are expected to take advantage of strong domestic soybean prices and increase their soybean acreage by 4-5% to 40.5 million hectares (100 million acres). If the weather cooperates, and that is a big if at this point, the 2021/22 Brazilian soybean production should be in the range of 143 to 145 million tons. If verified, that would be 6 to 8 million tons more than the USDA's current estimate of 137 million tons for the 2020/21 crop.

The USDA is estimating that the 2021/22 Brazilian soybean acreage will increase 1.8 million hectares to 40.4 million or an increase of 4.6%. They are estimating that soybean production will increase 7 million tons to 144.0 million or an increase of 5.1%