Due to adverse weather conditions related to El Niño, the Foreign Agricultural Service (FAS) of the US Department of Agriculture has lowered its forecast for corn and wheat production in Brazil in the marketing year 2023-24.
In its Global Agricultural Information Network report, released April 1, the FAS trimmed its corn harvest projection by 2 million tonnes from the previous forecast to 122 million tonnes, down from 135.5 million tonnes in 2022-23. The agency also slashed its projection for Brazil’s corn exports by 13% to 45 million tonnes.
In 2022-23, Brazil became the world’s leading corn exporter, surpassing the United States for the first time with shipments of 54.3 million tonnes.
The report noted that wheat output is also expected to significantly decline year-on-year from a record 10.6 million tonnes to 8.2 million.
“Heavy rainfall has severely impacted crops in the southern region, which is responsible for over 85% of the country’s wheat production,” the FAS said. “As a result, the availability of high-quality wheat in Brazil has been reduced, leading to an increase in imports, although mill agents say they are fully stocked.”
This follows a year in which Brazil exported 2.7 million tonnes of wheat, the second-highest total ever, while importing 4.7 million tonnes, its lowest intake in 31 years.
“For the past two years, Brazil has seen an increase in wheat exports, mainly due to a decline in wheat offered by Argentina,” the FAS explained. “The neighbouring country is Brazil’s leading provider of grain but suffered the past crops with lack of rain, which allowed Brazil to fill in. However, the current season has witnessed a reversal of this trend.”
The report noted that the recent decline in corn prices has affected producers’ planting decisions.
“Given this scenario, many producers are directing part of their crops to more profitable or safer options, such as cotton or sorghum,” the FAS said. “Despite these challenges, the harvest is still impressive and has the potential to become the second largest in history in terms of volume and value exported.”In its initial forecast for the 2024-25 crop year, the FAS sees Brazil’s corn and wheat crops rebounding to 129 million tonnes and 9.8 million tonnes, respectively.