Forecast Remains Hot & Dry for Northern Midwest

Brazil Corn Crop Update

• DERAL reported Paraná crop conditions were unchanged for the week at 22% good to excellent, remaining below last year’s 41%.

• IMEA reduced its production forecast for Mato Grosso to 32 million tonnes from 34.6 million last month.

• Mato Grosso yields are projected to be down 12% from last year.

• StoneX decreased its total Brazil crop forecast to 90 million tonnes from 100 million last month.

• AgRural cut its safrinha corn projection to 60 million tonnes from 65.1 million in the previous month.

• CONAB’s last forecasts were for a total crop of 106 million tonnes, which included a safrinha crop of 80 million and 36 million for Mato Grosso.

• USDA’s May projection for a total crop of 102 million tonnes will be updated next week along with new CONAB data.

FBN’s Take On What It Means: The recent rains in Southern Brazil have stabilized crop conditions but have likely not helped to recover yield lost to date. Brazil’s smaller second crop corn production will have a significant impact on its exports in the coming year and lead to larger shipments from the US. We expect this will be especially supportive of export sales post harvest.

• The official May bean exports were a record for the month at 16.4 million tonnes compared to 14.1 million last year.

• Shipments were moderately lower than the 17.4 million tonnes exported in April.

• Exports for the season from February through May total 49.9 million tonnes, up from 44.7 million last year.

• Brazilian soybean shipping lineup continues its weekly decline and is down to 7.9 million tonnes compared to 10.7 million last year.

• May soymeal exports were 1.7 million tonnes, down just marginally from last year.

• Corn exports in May were the lowest for the month since 2005 at 14,000 tonnes versus 25,000 tonnes last year.

• Corn exports for the marketing year since March are 437,000 tonnes, down from 503,000 last year.

FBN’s Take On What It Means: Demand for soybeans has been affected by negative Chinese crush margins and has resulted in slower buying for delivery later in the year. The record Brazilian crop has been needed to offset the very low stocks in the US, which should continue to support prices at least until more is known about new crop production.

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