Brazil's corn output slashed to 86.5 million mt: Conab

Brazil’s total corn crop estimates were slashed once again by a further 6.7 million mt to 86.5 million mt, 15.5% lower on the year, as second crop safrinha yield prospects were downgraded one more time, data from the Brazilian food agency Conab showed Tuesday in its monthly update.

The move comes after frosts hit major producer states again and means the second crop safrinha is now expected to reach 60.3 million mt, 19.6% lower on the year and 6.6 million mt less than the last estimate, in July.

“Corn crop areas were harmed by the prolonged drought, the worst of the last years. In addition, the frost had a considerable impact on our expectation,” Conab president, Rubens Rodrigues stated.

“It is usual to have drought and frost events in the second crop. It is not so common, however, for both to occur in the same year and with the intensity, we observed in 2021,” Conab crop evaluation manager, Maurício Lopes added.

The agency added if it wasn’t for the weather, corn production would be a record.

“The reduction in the estimate was not greater only because there was an important increase in area. We returned to the level of productivity similar to 2015/16, also because of the delays in planting,” Lopes said.

In its new forecast, Conab expects overall Brazilian corn yields in 2020/21 to decline by 25.7% on the year to 4.05 mt per hectare - a 6.3% reduction compared to last month’s estimate.

The agency reduced domestic consumption estimates from 71.3 million mt to 70.9 million mt, due to low availability, however, it still remains 3.3% higher than last year and still a record.

Corn exports were reduced to 23.5 million mt from 29.5 million mt expected in July.

Import estimates were kept unchanged, at 2.3 million mt, as a bigger share of the crop will be destined for domestic use.

Soybean production remains at an all-time record of 135.9 million mt with a slight 67,000 mt upward adjustment from the estimate released in July.

This represents an 8.9% year-on-year increase backed by increased acreage, which was 4.3% higher on the year, and improved yields, up by 4.5% on the same comparison.

Domestic demand was estimated at 50 million mt, 29,000 mt lower, and exports were forecast at 83,49, 3 million mt lower than the previous forecast of 86.69 million mt.

The reduction takes into account that Brazilian soybean exports reached 66.22 million mt from January to July, 2.51 million mt lower than the same period of 2020.