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The large volume of corn imports, which arrive at lower prices than local prices, puts pressure on the Brazilian corn market, points out TF Consultoria Agroeconomic. According to market analysts, there are currently more bearish factors than bullish ones.
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However, highlights the TF, the yields and production of corn in the United States have presented contradictory projections: “One released on August 12th by the USDA (US Department of Agriculture) caused surprise to the market, stating that yields and American production would be lower than expected.”
“The other, released this Friday by the ProFarmer expedition, which toured the physical fields of several producing states, stating exactly the opposite – that corn yields and production in the USA will be higher than the USDA claims. Pro Farmer Crop Tour field surveys indicated production projections well above those proposed by the last USDA (383 million tons vs. 374 million tons)”, point out the analysts.
According to them, this could cause corn futures prices to decline, as happened in the last two trading sessions this week, in which they fell 11.25 cents/bushel in each of them. According to TF, prices tend to stabilize around R$ 95.00 (lots) R$ 88.00 (farmer), which leads to the recommendation to “sell little by little”.
HIGH FACTORS
- Lower US (USDA) corn yield and production;
- Strong reduction in the Brazilian harvest;
- Long period of 6 months until the harvest of the next summer crop.
DOWN FACTORS
- Higher US corn yield and production (ProFarmer);
- Falling oil prices;
- Lower consumption of corn ethanol in the USA;
- Imported corn arriving at lower prices and large volumes.
By: Leonardo Gottems | agrolink
