Brazil's Second-Crop Corn Could Change How You Sell Your Grain

June 23, 2016 10:10 AM
 
Brazil's Second-Crop Corn Could Change How You Sell Your Grain

The increase in Brazilian corn production over the past decade has been nothing short of extraordinary, according to Ed Allen and Constanza Valdes, who have authored a report for USDA-ERS titled “Brazil’s Corn Industry and the Effect on the Seasonal Patterns of U.S. Corn Exports.”

The authors recognize Brazil as the current largest U.S. competitor, due in part to the country’s second-crop corn.

“Harvested late in the local marketing year, [it boosts] exports from September to January, months traditionally dominated by Northern Hemisphere exporters,” they write. “Brazilian corn might permanently alter the seasonal pattern of U.S. corn exports, highlighting the need to reassess export forecasting methods.”

The speed at which Brazil’s corn exports have grown is remarkable. Allen and Valdes note that these exports have grown by an average of 21% each year for the past decade, for a total sevenfold increase in exports since 2005. Projecting through 2025, Brazil is expected to be the world’s second-largest corn exporter, second only to the U.S.

The nature of those exports has shifted significantly during the past five years, the authors note.

Over the last 5 years, the seasonality of corn exports has grown more pronounced, with March-July shipments relatively low (less than 5% of annual exports per month) and August-January exports brisk (with over 12% per month for August through January),” they write. “For the latest five years, March-July corn exports have been a smaller share of annual exports than in the previous 10 years.”

That’s certainly something to ponder – especially in light of the fact that 48.1% of the U.S. corn crop is currently marketed between October and January.

“Given current seasonal patterns of Brazil’s corn exports, U.S. corn export sales are likely to strengthen in months when Brazil reduces corn export competition,” they conclude. “This will amplify the importance of U.S. corn export sales reported in February, March, and April.”

Back to news


 

RELATED CONTENT

Comments

 
Spell Check

No comments have been posted to this News Article

Corn College TV Education Series

2014_Team_Shot_with_Logo

Get nearly 8 hours of educational video with Farm Journal's top agronomists. Produced in the field and neatly organized by topic, from spring prep to post-harvest. Order now!

Markets

Market Data provided by QTInfo.com
Brought to you by Beyer
Close