Corn prices in Brazil were mixed during the week Aug. 16-22 as buyers did not show much interest in paying higher prices, while sellers were also reluctant to reduce prices, market participants said.
Some regions in Brazil saw corn prices fall, while others witnessed a further rise in prices.
“Despite the advance in harvest, the quality and availability of the harvested corn are not adequate,” Brazil’s national agricultural agency CONAB said in its weekly report. “In addition, international corn prices continue to fall….Expect stable prices in the short term.”
Sellers may have to accept new deals at lower prices to ensure fresh cash flows to service their debts that mature at the end of August and September, Brazil-based Center for Advanced Studies on Applied Economics, known as CEPEA, said.
Moreover, buyers expect corn supply to improve with the second corn harvest in Brazil at an advanced stage.
As of Aug. 21, 75.5% of the planted corn crop in Brazil was harvested as against 81.6% around the same period last year, data released by CONAB showed.
“For the time being, most producers also remain withdrawn from the market. As a result, trading is sluggish on the spot market,” CEPEA said in a note.
Meanwhile, trading in Brazil’s export market was also thin.
On Aug. 20, the FOB Santos corn market was empty as the Asian corn end-users were absent and as they were already covered or waiting for US corn prices to drop for the new huge crop that will be harvested in October.
“Let’s see how the market will price the new crop that could leave doubts about USDA’s September report yield,” a FOB Santos market participant said.
Brazil’s corn exports during the first 15 business days of August were at 2.947 million mt at a daily rate of 196,454 mt, while it was at 297,323 mt/day in the whole of August 2020, customs department data showed.
Brazil exported 6.24 million mt of corn in August 2020.
CONAB sees Brazil’s corn exports at 23.5 million mt in 2020-21 as compared to 35 million mt in 2019-20.
Source: Platts