Thursday, April 10, 2014

Rains arrive in time for Brazil corn, but not soy


Brazil's weather improved last month in time to boost hopes for safrinha corn, but not to prevent further losses to soybean crops, US farm officials said, explaining revisions to their harvest estimates.

The US Department of Agriculture, explaining a downgrade of 1.0m tonnes to 87.5m tonnes in its forecast for Brazilian soybean production in 2013-14, said that rains had not arrived in time to reverse drought damage to all crops in the drought-hit south.

"Rains arrived by mid-February and rain have continued in March providing much needed relief, especially in Rio Grande do Sul," the USDA said, in a report which comes a day before Brazil's official Conab bureau is set to reveal its own revised forecasts.

"In the other states, however, soybean yield potential did not recover."

Conversely, in the western state of Mato Grosso, Brazil's top soybean producer, heavy rains had extended into March, "causing yield losses [and] some quality damage".

'Off to a good start'

However, the recent rains had supported prospects for yields of safrinha corn – planted on land vacated by the soybean harvest - in all states, if delaying sowings in Mato Grosso, the USDA said, explaining a 2.0m-tonne increase to 72.0m tonne in its forecast for Brazil's overall corn output.

"All areas have been receiving beneficial, above-average precipitation," the USDA said, adding that the safrinha crop had got "off to a good start".

"Production is raised due to better yield potential for safrinha (second-crop) corn."

The safrinha corn harvest - which is particularly sensitive to rival exporters as it is the main source of Brazilian export supplies – will nonetheless prove smaller than last year thanks to weaker sowings, with price differences driving farmers to soybeans instead, in many cases for the first time as a second crop.

South Africa record

The USDA also raised its estimate for the South African corn harvest, which it said would show a record yield of 4.38 tonnes per hectare "due to timely and well-above-average rainfall during February and March in the western and central Corn Belt when the crop was in the critical pollination and grain-filling stages".

A field trip last month "observed good-to-excellent crop conditions, with interviewed farmers and traders reporting a bumper harvest expected for most regions", after drought had threatened crops early in 2014.

Satellite imagery showed that yields should come in "well above-average in the central and western part of the country".

The estimate for South African corn production was upgraded by 1.0m tonnes to a 23-year high of 14.0m tonnes, a rise of 1.6m tonnes year on year.

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