March 12, 2007

USDA: Higher global corn output due to bigger South American harvest

The US Department of Agriculture Friday (Mar 9) raised its 2006/07 marketing year forecast for global corn production, noting significant increases in South American crops.

The new world production forecast was raised in USDA's monthly World Agricultural Supply and Demand Estimates report to 693.15 million tonnes, up from the February prediction of 692.42 million tonnes.

The corn production forecasts for Argentina and Brazil were both increased this month.

"Production is expected to be a record in both countries as excellent growing season weather is reflected in higher yields," the USDA said in the March report. "Corn area for Brazil's winter crop is also expected to be higher as producers respond to high corn prices."

The USDA's forecast for Brazilian corn production was raised this month to 48 million tonnes, a 2-million-tonne increase from a month ago. Argentina's corn production is now forecast at 21.5 million tonnes, up 500,000 tonnes.

South Africa, though, will be producing less corn than previously predicted, the USDA said, because "drought and heat during February sharply reduced production prospects".

The new corn production forecast for South Africa is just 7 million tonnes, a 2.5-million-tonne drop from USDA's February forecast.