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October 9, 2020

Conab - 2020/21 Brazilian Soy Production up 7.1%, Corn up 2.6%

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

Conab released their first estimates of the 2020/21 growing season on Thursday. They are estimating a 7.1% increase in Brazil's soybean production in 2020/21 and a 2.6% increase in Brazil's corn production.

The 2020/21 Brazilian soybean production is estimated at 133.6 million tons, which represents an increase of 8.8 million tons or 7.1% compared to the 124.8 million tons produced in 2019/20. The 2020/21 soybean acreage is estimated at 37.8 million hectares (93.3 million acres), which is 2.5% more than last year's 36.9 million hectares (91.1 million acres). The soybean yield is estimated at 3,529 kg/ha (52.5 bu/ac), which is 4.4% more than last year's yield of 3,379 kg/ha (50.3 bu/ac).

The 2020/21 Brazilian corn production is estimated at 105.1 million tons, which represents an increase of 2.6 million tons or 2.6% compared to the 102.5 million tons produced in 2019/20. The corn production estimate must be viewed with caution because Conab simply carried forward the 13.7 million hectares (33.9 million acres) of safrinha corn planted last year. Conab will not issue an official 2020/21 safrinha corn acreage estimate until their February Crop Report.

Given the record high domestic corn prices in Brazil, it is almost a certainty that Brazilian farmers will increase their safrinha corn acreage in order to take advantage of the high prices. Additionally, Brazilian farmers have already forward contracted as much as 50% or more of their anticipated corn production, which has allowed them to lock in profits on their corn production.

The safrinha corn crop "makes or breaks" the Brazilian corn production because it represents approximately 73.0% of Brazil's total corn production. The safrinha corn production was estimated at 76.7 million tons. The full-season corn production was estimated at 26.7 million tons and it represents 24.4% of Brazil's total corn production. The third corn crop in northeastern Brazil was estimated at 1.6 million tons and it represents 1.5% of the total.

While they did not estimate the safrinha corn acreage, they did increase their estimate of the safrinha corn yield. The 2020/21 safrinha corn yield is estimated at 5,580 kg/ha (88.7 bu/ac), which represents an increase of 2.3% compared to last year's yield of 5,456 kg/ha (86.7 bu/ac).

Farmers in southern Brazil are in the process of planting their full-season corn and Conab estimated that the full-season corn acreage will decline 40,000 hectares to 4.23 million hectares (10.4 million acres).