Porto Alegre, December 20, 2021 – The La Nina phenomenon is once again leaving its mark on the climate of southern Brazil and part of Paraguay. Less rainfall in November, high temperatures in December, and only spotty rains are bringing the first definition of the summer corn crop, that is, the second consecutive production losses in Rio Grande do Sul.
We believe the losses in this state will be worse than those registered in the 20/21 season due to the greater scope of problems. Now, attention turns to other locations of the South region, which have later corn and are now entering the most critical stage for production definition. On the other hand, the condition of crops in other regions of the country is excellent and with good potential productivity. Thus, Safras & Mercado is cutting the national production to 116 mln tons and the summer crop, in the Center-South region, to 22.6 mln tons.
Production losses change the supply environment in the first half of 2022, which is aggravated by the strong pace of exports at the end of the business year, with consequences for carryover stocks. Low carryover stocks along with production losses in the South undoubtedly establish a new framework for internal supply. The ‘positive’ side is that the second crop enters a good planting window and with the harvest forecast to start in June.
Agência SAFRAS Latam
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