The United States Department of Agriculture this week raised its fiscal year 2024 agricultural export and import forecasts by $1 billion each, holding steady its estimate of a $30.5 billion…
Reuters writer Ana Mano reported yesterday that, “China is actively buying Brazil’s second corn, known as ‘safrinha,’ even as farmers grapple with planting delays in the world’s third biggest producer of the cereal.
“According to grain traders, China has bought in advance at least 1.5 million tonnes of Brazil’s safrinha crop, representing more than 10% of total forward sales of the staple product. Farmers have sold an estimated 14 million tonnes of their next safrinha crop, traders said.”
Mano explained that, “Farmers are currently planting Brazil’s second corn, which is sowed after soybeans are harvested in the same fields.”
The Reuters article added that, “Brazil plants corn all year round, but the safrinha crop is the biggest, representing 70% to 75% of national production in a given year.
“Barring bad weather events, Brazil’s second corn output may be around 96 million tonnes, allowing the country to produce the biggest overall crop in history.
Based on current market expectations, Brazil may overtake the U.S. as the world’s biggest corn supplier for the first time this season, with the USDA projecting Brazilian exports of 50 million tonnes.
In its monthly Feed Outlook report last week, the USDA’s Economic Research Service pointed out that, “Lower corn exports by the United States and Argentina are partially offset by increases in exports from Brazil, Ukraine, and India. Projected October-September Brazilian corn exports are revised up 1 million metric tons from a month ago to 52 million.
“Brazil has seen a boost in corn exports in the first half of 2022/23 trade year. China began importing Brazilian corn, in part due to lower Brazilian corn port prices through mid-January, while the United States was (at the time) the highest priced corn supplier globally. In addition to price competitiveness, in October 2022, China officially decided to permit more than 100 Brazilian facilities to export corn to China.”
Recall that earlier this month, Reuters News reported that, “Brazil’s agriculture ministry said on [March 3rd] that 90 local firms have been cleared to export corn to China in the first two months of the year, taking the total to 446.
“The information comes as Brazil forecasts its corn exports to reach a fresh record this year, potentially beating the volume shipped by the United States, according to a statement.”
Some additional background regarding China’s recent approval and purchases of Brazilian corn can be found in this FarmPolicyNews update from early March.
More broadly, a FarmPolicyNews update last month noted that, “Brazil corn exports have exceeded those of the United States only one other time, in the drought year of 2012/13. Since October 2022, Brazil has exported about 25 million tons of corn, far exceeding the same period in any prior year.”