Inor Ag. Assmann
12
A
s long as weather conditions
were favorable, planting inten-
tions continued soaring, and
the second Brazilian corn crop
of the 2016/17 season acquired
“huge” proportions, farm -gate corn prices
began todecline,making it impossible to sell
the crop in some corn producing regions, es-
pecially in the hubs in Mato Grosso, leading
producer. Pictures of harvested corn lying in
the open because of deficient transportation
or warehousing structures, and prices way
below production costs and below the min-
imum prices stipulated by the government
were facts thatmadenews inJune.
This giant harvest exerted an abnormal
pressure upon the prices practiced in Bra-
zil, even before it was available, and forced
the federal government to intervene offering
commercializationmechanismsatminimum
prices, at least offering the market a refer-
ence. The sector views this measure as posi-
tive. After the first half of the year on adeclin-
ing trend, the supply chain is eager to know,
especially the farmers, what the prices will
look like and which factors will induce them
tocover theproductioncosts.
There are lots of hurdles to be surmount-
ed: they include the local economic scenar-
io and all major buyers of the grain and of the
Brazilian proteins, going through the nation-
al political scenario, which has influenced the
exchange rate, for example, to the balance
between offer and demand, and the size of
the stocks at home and abroad. With the ex-
change rate ranging from R$ 3.25 to R$ 3.30
toUS$1,itishopedthattheresumptionofex-
portsthatstartedinMayisforreal,withthede-
clining national supplies translating into high-
er cornprices. In spiteof this, the year inBrazil
willcometoaclosewithahugeendingstock.
As things are, without a new fact that
boosts consumption and shipments abroad
considerably, the expectation is for pric-
es in Brazil to recover gradually and partial-
ly, without reaching the record prices inmid-
2016. This will lead to smaller planted areas
in the 2017/18 growing season. Even if soy-
beanprices reachhigher recovery levels than
projected in early 2017, the farmers who lost
moneyinthecurrentcropwillthinktwicebe-
fore keeping the soybean-corn succession
system, andwill seekalternative crops.
The 2017 crop ratifies what all farmers al-
ready know: super crops are the ones that
generate profits. Foodon the table andmon-
ey in the pocket that covers the production
costs, areassurances for thenext crop, the in-
vestments and the sustenance of the family:
these are crops for the farmers to commem-
orate. In the current season, only a few farm-
ers have reasons to celebrate the achieved
target.
n
Super isacropthat
generates
profits
Volume of BrazilianandNorth-American
crops,theexchangerate,stockprofileandconsumptionare
challengingfactorswhenitcomestosellingthe2017crop
Hugewinter crop exerts pressure upon themarket, and exports is the onlyway out
