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March 16, 2021

2020/21 Brazil Safrinha Corn 75% Planted, Ideal Window is Closed

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

The safrinha corn in Brazil was 75% planted late last week compared to 89% last year according to AgRural. This represents an advance of 20% for the week. The ideal planting window for the safrinha corn closed at the end of February and we are now at the limit of when safrinha corn is normally planted in Brazil, but as we all know, this has not been a normal year in Brazil.

Even though the planting window has closed and there is still 25% of the safrinha corn left to plant, Brazilian farmers for the most part are still willing to plant their corn due to the strong domestic corn prices.

There is a definite downside risk for the crop due to how late the safrinha corn will be planted. The eventual yield will be determined by when the rainy season ends. If it extends into early June, which is a month longer than normal, then the safrinha corn yields might still be OK. If the rains end at the normal time of early May, the safrinha corn yields will be disappointing.

In their March Crop Report, Conab increased the 2020/21 Brazilian corn estimate by 2.58 million tons to 108.0 million. They increased their estimate of the safrinha corn acreage by 320,000 hectares (790,000 acres) to 14.67 million hectares (36.2 million acres). See later article.

At the same time, Brazil's Minister of Agriculture, Tereza Cristina Dias, expressed concern last Friday about the lateness of the safrinha corn planting and the possibility of lower yields. She said her "perception is that perhaps agriculture commodities prices will take another leap."

Strong Domestic Corn Prices in Brazil - Farmers are expected to plant their safrinha corn past the normal end of the planting period due to the very strong domestic corn prices. Current domestic corn prices in Brazil remain strong in the range of R$ 75.00 to R$ 80.50 per sack (approximately $6.20 to $6.50 per bushel). On the B3 futures Exchange in Sao Paulo, May futures are in the range of R$ 93.00 per sack (approximately $7.65 per bushel).

Cold and Dry Weather Could Impact Safrinha Corn in Southern Brazil - An agricultural meteorologists in Brazil is warning that the safrinha corn in the south-central areas could be impacted by cold and dry weather. For the period April-May-June, he is forecasting that the rainfall will be below normal in the south-central region with colder than normal temperatures and chances of frost. Rainfall during March is already below normal and he expects that to continue going forward.

Parana is the second leading safrinha corn producing state in Brazil and the safrinha corn planting in Parana is delayed by at least a month, increasing the risk of cold temperatures. Colder than normal weather has already occurred in parts of Parana with temperatures as low as the low 40s F last week. He feels the atmospheric conditions are favorable for cold fronts to move in with greater intensity. So, in addition to dryer than normal weather, it could also result in stronger than normal cold fronts accompanied by frosts in the states of Parana, Mato Grosso do Sul and southern Sao Paulo.

Mato Grosso Corn - The safrinha corn in Mato Grosso was 88% planted late last week compared to 99% last year and 97% average according to the Mato Grosso Institute of Agricultural Economics (Imea). This represents an advance of 15% for the week. The most advanced planting is in the northeastern part of the state where 94% of the corn has been planted. The slowest planting is in the south-central part of the state where 73% of the corn has been planted.

Approximately 30% of the safrinha corn in Mato Grosso will be planted after the ideal planting window has closed.

Parana Corn - The safrinha corn in Parana was 36% planted as of earlier last week compared to 68% last year according to the Department of Rural Economics (Deral).

The Secretary of Agriculture for the State of Parana had petitioned the Brazilian Minister of Agriculture to extend the planting period for safrinha corn by 10 days and still be eligible for government programs, but the Ministry announced last Friday that the request was denied. The state had argued that without the extension, there may be a disincentive to plant corn at a time when domestic corn supplies are very tight.

Rio Grande do Sul Corn - Farmers in the state have harvested 60% of their full-season corn with another 15% approaching maturity.