The Ministry of Agriculture of Argentina announced last week that the corn surface regarding the 2016/2017 season will grow between 10 and 15 million metric tons. The advance would happen, according to the Argentine government, through an advance of the corn surface through previous soybean areas. “We estimate that we would have from 10 to 15 million metric tons more of corn production. That is a jump of 20 percent. While the soybean volume would fall from a total of 60 million metric tons to 55 million metric tons,” said the agriculture minister, Ricardo Buryaile to Reuters.
About forty percent of the projected wheat surface was already planted in Argentina, according to the Rosario Board of Trade. The report of the Board of Trade yet reveals that the crop has been really homogeneous throughout the country with low temperatures, frosts and without rains, but with a greater advance in the south of Santa Fe and the Buenos Aires province. The weather forecast for the coming weeks is favorable for the wheat development.
The demand for soybean is still strong in Brazil. Farmers from the state of Mato Grosso alone had sold 5.9 million metric tons just in May, according to numbers from the Mato Grosso Institute of Agricultural Economics (Imea). Of those, nearly 2.5 million metric tons are from the current crop and 3.5 million metric tons anticipated from 2016/2017 season. Prices are still favorable in June.
Exports, on the other hand, did not have a so positive result. They reduced to 3.19 million metric tons in the month of May, but do not revert a scenario of more international demand than last year. From January to May, about 1.0.5 million tons of soybeans originated in Mato Grosso were exported – 54 percent more than in the same months of 2015.
A survey from the Mato Grosso Institute of Agricultural Economics (Imea) points out that the corn yields in the Brazilian state of Mato Grosso have dropped this year to 83.4 bags of 60 kilograms per hectare (74 bushels per acre), while the costs have jumped 72 percent, reaching a record. Imea experts say that most of fall is due to the climate adversities. Yet, this estimate does not consider new possible losses. Sales, on the other hand, are faster than expected because of favorable prices.
Brazil’s National Supply Company (Conab) has reduced its estimates for corn production in Brazil. The agency now says the country will produce 49.9 million metric tons at its second corn crop. The previous forecast was at 52.9 million metric tons. The prediction for the summer corn crop was also adjusted from 27 million metric tons to 26.2 million metric tons. Therefore, the total corn production in the country would be 76.2 million metric tons.
Brazil’s National Supply Company (Conab) has reduced the projection of the Brazilian soybean crop size to 95.6 million metric tons. The previous forecast had put the production value for the 2015/2016 season at 96.5 million metric tons. In January, Conab had estimated that hte Brazilian soybean production in this season would be 102.1 million metric tons. The season was marked by dry weather in center-western state like Mato Grosso and Goiás, while there were floods in states like Rio Grande do Sul and Paraná.
Nearly one quarter of the surface of the second corn crop in the Brazilian state of Paraná has a “moderate risk” of loss due to frosts forecast for this Wednesday and Thursday, according to local experts. “A greater risk is located at the regions west, center and south,” said Edmar Gervásio, a corn expert at the state’s ag agency. About 50 percent of the crop in Paraná is at the stage of fruitification and susceptible to loss, but half of those areas are located in regions with low risk of frost.
Several lawmakers of the Brazilian state of Mato Grosso are considering to impose an export tax on all commodities produced in the state, among some other tax and fees increases, in an effort to boost revenue. Today, the Association of Soybean Growers of Mato Grosso reported that some of its leaders have met governor Pedro Taques and he promised to veto any law that would result in export taxes. “The talk about the possibility of export taxes have cooled the business climate in the state,” said Endrigo Dalcin, president of the Association of Soybean Growers of Mato Grosso.
Consultancy INTL FCStone has reduced its forecast for the size of the Brazilian second corn crop. In May, there was a perspective of total production of nearly 77.8 million metric tons, but this was lowered to 76.6 million metric tons. The reason is that the size of the second corn was estimated down from 49.8 million metric tons to 49.4 million metric tons. The summer crop size was also reduced from 28 million metric tons to 27.2 million metric tons. According to analysts at INTL FCStone, there wasn’t enough precipitation in Mato Grosso and Goiás in April and May in the end of the summer crop harvest. The planted area of the second corn crop was reduced in Maranhão, Tocantins and Mato Grosso do Sul.
The government of the Buenos Aires province has authorized an increase of 23.5 percent on transportation prices of grains and cereals. Buenos Aires is the largest producer of soybeans, wheat, and corn in Argentina. The increase considered the “wages implied on the personnel, costs of transportation and the amortization of capital”.