September 17, 2007

Brazil's 2007/08 soy, corn harvest to hit record

Soybean and corn output in Brazil will register another record harvest rise next season as US ethanol production pushes up prices for the commodities, a Brazilian analyst firm said.

Brazil-- the world's second largest soy grower after the US -- is expected to reap 62.3 million tonnes of oilseed for 2007/08, up from 58.6 million tonnes this crop year, according to Florianopolis-based Agroconsult. The country's corn yields will rise to a record 38.3 million tonnes from 36.5 million tonnes.

The booming US ethanol is aggressively hiking demand for corn and discouraging American farmers from planting soybeans, pushing up the price of both commodities. Soybean prices jumped 77 percent and corn by 55 percent.

Agroconsult analyst Andre Debastiani said that reduction of US soy for corn will result to a big dispute for Brazilian corn, soy and wheat that will support good prices.

The rising prices are prompting Brazilian farmers to increase planting of soybeans for the crop year that starts next month by 6.5 percent to 22 million hectares (54 million acres), Agroconsult said. Corn growers will plant 9.7 million hectares, 2.5 percent more than in the crop year ending this month.

As corn commands high prices in the international market, Brazilian corn growers are also prompted to raise and ship more of the grains abroad. Agroconsult said the country is expected to export a record 8.5 million tonnes this year.