Brazil: Record Corn Production in 2012/13; Lower Expectations for Next Year

Brazilian corn production in 2012/13 is currently estimated at a record 76.0 million tons, surpassing last year’s record harvest of 73.0 million metric tons. The 2012/13 crop benefitted from abundant rains in key-growing areas, especially the state of Mato Grosso. Expectations for next year are lower, with production forecast at 72.0 million metric tons. Corn area in 2013/14 is expected to be marginally lower and is estimated at 15.50 million hectares, down from 15.64 million hectares in 2012/13. Corn yields in 2013/14 are forecast at 4.65 tons per hectare, 4 percent lower than the 4.86 tons level achieved in 2012/13. At this early stage the 2013/14 forecast includes the assumption of normal weather, which would not include a repeat of the exceedingly beneficial conditions experienced in 2012/13 ( an extended rainy season and above-average precipitation in Mato Grosso). Planting of the first corn crop in 2013/14 will begin in September, while second-crop planting operations will begin in January 2014.

Over the last several years Brazil has dramatically increased corn production, though corn area has only increased marginally. The most recent surge in production—from 57.4 million tons in 2010/11 to 76.0 million tons in 2012/13—resulted from higher area and record yields in the second corn crop. The nearly 19 million ton increase in production enabled Brazil to become the world’s top corn exporter, surpassing the United States in trade year 2012/13 (TY2013) when U.S. corn production was reduced due to drought. Brazilian corn yields have steadily improved due to increased fertilizer use and adoption of varieties better suited to the disparate regional climates, including genetically modified varieties. Brazil has already approved 18 biotech corn events for commercial use. Typically first-crop corn yields have been higher than those in the second-crop, however, during the past 2 growing seasons (2011/12 and 2012/13) the opposite occurred. The higher yields achieved in second-crop corn have been due to an extended rainy season and above-average precipitation, especially in the state of Mato Grosso.

Brazil has two seasons for corn production. First-crop corn is planted in September and is harvested in March. Production largely serves the domestic feed market. Demand from the domestic feed market has not declined and planting intentions for the 2013/14 first-crop corn are about the same as last year. Second-crop corn is planted in January after the early-season soybean harvest. Production from the second corn crop is destined for the export market. Expectations for 2013/14 second-crop corn area are similar to those in 2012/13 despite the expected decrease in international prices. Second-crop corn is planted directly after the soybean harvest in key states such as Mato Grosso and it provides agronomic benefits. Agronomic benefits include improved soils and better insect control from volunteer biotech corn in the following soybean crop. Corn prices, however, are expected to be much lower in early 2014 so the incentives to manage the corn crop are lower too. Traditionally, first-crop corn had been the larger of the two and the second-crop corn was called Safrina—or little crop. But now the increased second-crop corn area and yields have made it the larger crop, currently accounting for more than 55 percent of national production.

Brazil’s two corn crops are grown in different areas. Minas Gerais and Paraná are the largest first-crop corn producing states whereas Mato Grosso is the largest second-crop corn producer accounting for 40 percent. Other large second-crop corn states are Paraná and Mato Grosso do Sul, which taken together, produce over 40 percent.

Key Second-Crop Corn Area is Mato Grosso: Mato Grosso is the largest producer of second-crop corn and planted area has been increasing greatly—the 2012/13 area is more than double the area in 2008/09. The increase in corn area is not the result of increased land clearing. Corn is planted directly after the soybean harvest; sometimes soybean harvesting and corn planting occur the same day. With two crops from the same field, farmer’s profitability has increased. The amount of soybean area that is followed by second-crop corn in Mato Grosso has increased from 15 percent in 2005/06 to 42 percent in 2012/13. There is a trade-off for this crop rotation practice, however, and lower potential yields from soybeans are traded for higher potential yields from corn. The lower potential soybean yields result from using early-maturing soybeans and a forced end to the growing season. Farmers spray a defoliant on the soybeans when the leaves are still green to force the crop into senescence. The early end of the soybean season allows corn planting to occur at an optimum time. When FAS personnel travelled to Querencia in northern Mato Grosso in late January 2013, farmers told us they like to plant corn in mid-January and they need to plant corn before February 20. Early planting of corn allows the critical growth stages of flowering and grain-fill to occur before the end of the rainy season. The rainy season typically ends in April and May. Rainfall begins to taper off in late April and little rain occurs in May as seen in the average line on the cumulative precipitation chart. In 2011/12, the second corn crop in Mato Grosso benefited from an extended rainy season, with rains occurring through June 2012. This year, rains have been abundant but have fallen in a more typical pattern.

Current Conditions in Mato Grosso: Satellite-derived vegetation indices indicate that 2012/13 second-crop corn conditions in Mato Grosso are similar to but slightly less than last year as of early May 2013. FAS Washington analysts routinely monitor several areas in Mato Grosso using normalized difference vegetation indices (NDVI). In central Mato Grosso, from Sinop to Lucas do Rio Verde, vegetation conditions for second-crop corn are similar to last year. About 50 percent of Mato Grosso’s corn area is in the central area or Medio-Norte. In western areas of Mato Grosso, from Sapezal to Campo Novo do Parecis, vegetation conditions for second-crop corn are slightly worse than last year. And in southeastern Mato Grosso, around Primavera do Leste, vegetation conditions for second-crop corn are also slightly worse than last year. Southeastern Mato Grosso has about 20 percent of the state’s corn area.

About the NDVI Data: Charts of normalized difference vegetation indices (NDVI) from areas in Mato Grosso show characteristic bi-modal pattern of biomass development. The biomass peak from October to mid-February is soybeans and the peak from March to June is second-crop corn. NDVI measures plant biomass and for corn the maximum NDVI occurs when the crop is flowering. The satellite-derived indices use NASA’s Aqua satellite and the Moderate Resolution Imaging Spectroradiometer (MODIS) sensor in 8-day composites. A croplands mask from South Dakota State University (SDSU) is used so that only NDVI from croplands are displayed in the charts. NDVI data displayed in the charts are average NDVI from croplands. Each chart represents observations from eight 25-kilometer gridcells or an area of about 600,000 hectares.

Current USDA area and production estimates for grains and other agricultural commodities are available on IPAD's Agricultural Production page or at PSD Online.