Brazilian farmers are at the end of the second-corn crop harvest. Dr. Michael Cordonnier, an agronomist with Soybean and Corn Advisor, Inc., talks about the lower results.
â€œThe safrina corn yields in Brazil have come down here at the end, and you saw last week that Conab dropped their corn estimate about a million tons down to 114.6. USDA left the Brazil corn estimate at 116. Now, I’m at 112 (million). I think Conab will lower it a little bit more next month, and mine might be a little bit too low, so we might come to an agreement, maybe 113 million tons for Brazilian corn. Yields keep getting lower and lower because the crop was more impacted by that drier weather and this new pest they have down there, corn leaf hoppers. So, yields keep getting lower and lower as the harvest gets closer to the end in Brazil.â€
He says the new leaf hopper infestation might change the planting cycle in South American farm country.
â€œEach year is getting worse, and this year got a lot worse and itâ€™s going to influence the way they do safrina corn. For example, in Parana, I think they’re going to cut back on the first crop of corn, shift it to the safrina, and plant more soybeans early because they say that little moth migrates from more mature corn to less mature. So, the longer you get corn out there, the more chances it has to multiply and produce more little moths. Also in Mato Grosso, they don’t plant much first crop of corn, they plant a little, but they’re telling farmers in Mato Grosso to not plant any first crop of corn and put it all in the safrina.â€
That first corn crop in Brazil may eventually all get planted when the second corn crop typically goes in the ground.
â€œYou don’t want that first crop out there so the moths can multiply and reproduce and then be available even more so for the safrina, and they’re telling farmers to choose more tolerant hybrids. Now they don’t have any completely resistant hybrids, but some are better than others, so try to choose corn hybrids at least tolerate it a little bit more. The moth emits a virus, and this virus has caused what’s called corn stunting, so the corn gets stunted by the virus which is transmitted by the moth. The moth itself doesn’t do much harm at all. It’s the virus that it transmits that does the harm.â€
No more first-crop corn in Brazil would be a big change, especially for livestock producers that need to feed their animals.
â€œIn southern Brazil, yes, it would be. Now, a lot of that first crop of corn is produced by small landowners in southern Brazil. Now, the less they produce for a first crop, the more that livestock guys worry because all that first crop of corn goes to livestock producers in southern Brazil. So, if you produce less of a first crop, they have to store more corn and buy more corn either from central Brazil or more from Argentina or Paraguay, so thatâ€™s a concern for the livestock guys in southern Brazil.â€
Thereâ€™s some uncertainty about when the Argentina harvest results might hit the world market.
â€œWell, I just put out my first estimates for Argentina. I think the soybean area goes up a little, the corn area goes down a little, and mostly because farmers in Argentina are not very well-capitalized. They’re very slow sellers. They’re holding on to last year’s crops as much as they can as a hedge against inflation, which could be approaching 90 percent by the end of the year. So, they want to hold until there’s a devaluation of the peso, which everybody expects will come because the peso has devalued at a slower rate than inflation. At some point, it’s got to catch up to inflation.â€