October 1, 2003

 

Brazil 2003/04 Corn Exports Seen Rising Sharply

 

Brazil should export 3 million to 3.5 million tonnes corn in 2003/04, up from 2.5 million last season, as U.S. and European crops wilt due to hot weather conditions, analysts Safras e Mercado said on Tuesday.


"With the bigger crop at home and weather problems abroad, Brazil's corn export profile could shift a bit toward Europe this year," said Safras corn analyst Paulo Molinari.


But he noted that South Korea was Brazil's largest corn importer, with 550,800 tonnes bought by the end of August. Spain was the No.2 buyer at 369,000 tonnes followed by Iran at 309,000 tonnes. Italy, one of Europe's main corn growers, was also reported buying an unprecedented lot of Brazilian corn in September.


Shipping agents Transcar said Bunge was exporting 24,000 tonnes of Brazilian corn from Paranagua later this week for Indonesia, Louis Dreyfus had shipped 27,400 tonnes of corn for Italy last week and was shipping another 24,000 tonnes for Japan from Santos port next week.


The port authority at Paranagua, Brazil's main grain port that accounts for over 70 percent of the country's corn exports, said the port had exported over 2 million tonnes from Jan. 1 through Sept. 29, compared with 1.44 million tonnes over the same period in 2002.


A spokeswoman at the port authority said a ship carrying 60,000 tonnes of corn for Cargill to Spain was due to arrive Tuesday for loading and three other ships were due to load smaller mixtures of soymeal and corn destined for Spain, Italy and another European port this week.


A trader at Louis Dreyfus said on Tuesday corn export prices had eased slightly. Nearby October exports were quoted at $105/$109 (bid-offer) a tonne FOB Paranagua. November shipments were quoted at $108/$112 a tonne and December at $109/$112.


"One of the appeals of Brazilian corn is that it's not genetically modified," said Molinari who said the exports were for grade three yellow corn, mostly used for livestock feeds. "We expect exporters will ship about 400,000 tonnes a month through January according to our projection." The Agriculture Ministry pegged the current February-January crop at a record 47.3 million tonnes in its latest forecast, up 34 percent from the 35.2 million tonnes harvested last season.


Brazil's livestock industries consume about 70 percent of Brazil's large corn crop, providing firm demand domestically. "Producers are sitting on the remaining stocks because they expect international prices to rise," said the director of grain exports at a large U.S. grain trader in Brazil.


The U.S. and European corn crops have suffered losses under the inclemently hot, dry weather in their respective grain belts this year and Brazilian exports should pick up some of the slack in world demand.


"Local buyers are offering better prices than the foreign market, so producers will probably wait until harvest pressures weaken in the United States and Europe in October before returning to the export market," said the director.

 

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