Brazil exported 2.7 million tonnes of corn during the month of August, says the country's Agriculture Ministry, up a whopping 81% over year-ago figures. It's numbers like that which have got poultry and hog producers here worried (the cattle guys are better off, with so little confinement here in Brazil.) They also say the country's July corn exports came to 1.7 million tonnes, generating $419 million-- a crazy 431% over the value of corn exports in July of last year.
Meanwhile, poultry production costs have climbed along with corn prices, going up as much as 25% in this big broiler-producing country. By mid-August, the head of the Brazilian national pork producers association was huddling with Ag Ministry officials in the country's capital, seeking relief from corn prices that were 17% higher last year—and nearly 90% higher than in 2010, in local currency terms. It's enough to have the pork producers tracking port movement daily, keeping track of corn exports.
"There is a risk of low supplies and price peaks for foods made from corn in Brazil," says Mato Grosso Congressman Homero Pereira, who heads up the Ag caucus in the country's federal congress. He wants to raise the minimum price for corn to help keep more of it here in Brazil at a time when foreign market prices are attractive.
At the current exchange rate, the minimum price for corn ranges from $4.62 to $5.04 per bushel, depending on where in Brazil the corn is sold. Yes, that is an academic point, as a corn association here points out that it's been 20 years since the minimum corn price has been enforced in practice. But be that as it may, corn prices in Brazil's southern state of Paraná were $5.72 per bushel on Thursday Sept. 13 and $4.31 per bushel up in Mato Grosso, where they just brought in their largest second corn crop ever.
And more of that corn went to the U.S. this year, the Ag Ministry says. January to August Brazilian corn exports to Uncle Sam hit 44,000 tonnes, at a value of $13 million. No, it's not enough to make much of a difference— but it's way up from the same period of 2011, when 3.4 tonnes were shipped, at a cost of $15,000 or so.
Brazil's Conab—the foodstuffs supply agency—says carryover stocks will sit at nearly 13 million tonnes for 2011-12, up 114% from the previous season.
But prices remain high in Brazil, and, especially, for export.