Brazil to Raise 3.6 Billion Bushels of Corn

Brazil to Raise 3.6 Billion Bushels of Corn
Todd Hubbs, Agricultural Economist - University of Illinois

The United States Department of Agriculture has a put a pretty big number on the Brazilian corn crop. Todd Gleason reports it may be too big too soon.

USDA, in it’s monthly supply and demand…
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USDA, in it’s monthly supply and demand report for March, made special note of the corn crop in Brazil. This is because the agency dramatically increased the amount of corn the South American nation is expected to raise this year. It says, quote, “Brazil corn production is raised on increases to both projected area and yield. Reported first crop yields have been record high, while the rapid planting progress of second crop corn in the Center-West boosts expected area and yield prospects, allowing for greater crop development prior to the normal end of the rainy season” end quote. University of Illinois Agricultural Economist Todd Hubbs thinks the World Agriculture Outlook Board - the part of USDA that developed the numbers - may be getting ahead of itself.

Hubbs :38 …from a forgone conclusion in the corn crop.

Quote Summary - The USDA raised Brazilian corn production to 3.6 billion bushels. When you look into the world production numbers they raised acreage a little bit, but it was yield that generated a lot of this number. I understand there need to do that if they think this crop is coming on, but the safrina crop, that second crop of corn, there is a lot of weather risk involved in that corn crop. It is just in the ground. The idea that all those bushels are going to show up is far from a forgone conclusion in the corn crop.

It if does show up, Hubbs says that’s a lot of corn coming out of Brazil. However, he’s in a wait and see pattern. Hubbs, along with Illinois ag economists Scott Irwin and Darrel Good have been looking into the yearly variability of crops come out of South America. Their research is posted to the farmdocDaily website. He says it points to a great bit of downside and upside risk in Brazil’s second crop corn.