Consultant Sees Large Gains in South American Corn Acreage

Posted on 03/09/2017 10:20 AM

 

South American crop consultant Dr. Michael Cordonnier's early crop pegs reflect expectations for the region to grow 25% more corn in 2016-17 compared to year-ago and for soybean production to rise by 4.7% from year-ago. He currently projects corn acreage in Brazil to rise by 4% and to rise by 25% in Argentina. Meanwhile, he expects soybean acreage in Brazil to rise by 1.5% and decline by 3% in Argentina.

 

Cordonnier says there are several reasons for a slowed pace of expansion of soybean acres in Brazil, including, "More emphasis on full-season corn in southern Brazil, lower domestic soybean prices relative to corn, lower international prices for soybeans, farmers are less capitalized due to poor crops in 2015-16, higher costs of production, tight credit policies in Brazil, higher interest rates, higher inflation and a struggling Brazilian economy."

In Argentina, corn acreage expansion is largely due to the elimination of the corn export tax and the country's hesitation to followthrough with a promise to reduce the soybean export tax from 35% to 30%. He also notes the government's promise not to interfere in the corn export market, a devaluation of the country's peso making its corn exports more competitive and a desire for a more balanced rotation between corn and soybeans.

Dr. Cordonnier 2016-17 Soybean Estimates
Est.
Maximum
Minimum
2015-16

in million metric tons

Brazil
100.0
103.0
96.0
95.5
Argentina
58.0
60.0
56.0
56.0
Paraguay
9.1
10.0
8.5
9.0
Bolivia
3.1
3.5
2.7
3.0
Uruguay
3.0
3.5
2.7
2.0
Total
173.2
180.0
165.9
165.5
Dr. Cordonnier 2016-17
Corn Estimates
Est.
Maximum
Minimum
2015-16

in million metric tons

Brazil
82.0
88.0
78.0
66.0
Argentina
35.0
32.0
38.0
27.0
Paraguay
3.2
4.0
2.7
3.1
Bolivia
0.7
1.0
0.6
0.7
Uruguay
0.4
0.6
0.3
0.4
Total
121.3
125.6
119.6
97.2


Cordonnier says around 2% of Brazil's soybean crop has been planted, just slightly behind the average pace. He says around 30% of Brazil's full-season corn crop has been planted, which is ahead of the average pace of 19% for this time of year. He says farmers in Argentina took advantage of drier conditions to get 15% of anticipated corn acres planted, which compares to 5% on average. Soybean planting in Argentina typically begins in early October.

 


 

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