Brazil's so-called little crop is going to be bigger than ever, flooding an already oversupplied global corn market and further pressuring prices.
Forecasters increased output estimates this week to 81 million tonnes for the summer and winter growing seasons, as heavy rains prompted a cornfield growth spurt. The Porto Alegre-based research company Safras & Mercado is expecting a record 83 million tonnes.
Global corn prices have slumped 24 per cent in the past year as bountiful harvests in two straight seasons boosted supplies to all-time highs. The prospect of another bumper crop in the US is already weighing on the market, and researchers say the industry is underestimating Brazil's farmers.
Farmers in Brazil typically plant corn after the soybean harvest, taking advantage of late Southern Hemisphere summer rain. This second planting is known as "safrinha", or "little crop", which Safras & Mercado expects to reach 53 million tonnes this year, more than the total from this year's summer season.
"As the harvest advances and this corn hits the market, prices will be further pressured down," said Ana Luiza Lodi, an analyst at INTL FCStone.
