Cepea, June 1st, 2021 – Corn prices dropped in late May in most Brazilian regions surveyed by Cepea, due to the higher interest of sellers in marketing the cereal.
Farmers were more interested in closing deals in the spot market, since the harvesting of the second crop is near, crops conditions are expected to improve, and international corn prices decreased. Purchasers opted for consuming their own inventories, expecting new devaluations as the harvesting advances.
Still, between April 30 and May 31, the ESALQ/BM&FBovespa Index for corn (Campinas, SP) remained firm (+0.3%), closing at 100,07 BRL (19.15 USD)/60-kilo bag on May 31.
In general, prices were underpinned by low corn supply in the Brazilian spot market. According to Cepea researchers, although the harvesting of summer crops was ending in May, many farmers were not interested in selling the product, concerned about the development of second crops, which may be damaged by the dry weather. On the other hand, purchasers needed to replenish inventories during most of the month, increasing the demand for the cereal.
At ports, the trading pace was slow, largely due to the high domestic prices. In May, corn prices dropped by 8.1% in the wholesale market of Paranaguá port (PR), to 84.16 BRL/bag on May 27.
This scenario encouraged Brazilian purchasers to search for corn abroad. According to Secex, in the first 15 working days of May, Brazil imported 45.7 thousand tons of corn, much more than the 8.5 thousand tons imported in May/20.
CROPS – In Rio Grande do Sul, 90% of the summer crop had been harvested until May 28, according to Emater/RS. As the soybean harvesting advanced, activities in corn crops are expected to step up as machinery is available. In Paraná, until May 24, 22% of corn crops were in good conditions, 47%, in average conditions, and 31%, in bad conditions, according to Seab/Deral.