BRASÍLIA: If there is a silver lining to Brazil’s recent shortcomings in grain exports, the country is now more prepared than ever to pump out big volumes in 2017, perhaps to the dismay of its competitors. Brazil is the No. 1 and 2 shipper of soybeans and corn, respectively, but earlier this year, the drought-stricken country found itself with much less exportable supply than expected at the wrap-up of harvest.
Brazil should be at the height of corn shipping season from October through December, but saying that corn exports have been dismal over the last two months might be far too generous. Shipments for corn and its byproduct, ethanol, were down by nearly 80 percent in October and November versus a year ago. Soybeans fared slightly better with exports down two-thirds over the same time frame, although exports of the oilseed do not usually get going until February or March.
But now with the drought of 2016 mostly in the rear view mirror, record corn and soybean crops are a real possibility heading into 2017, particularly if favorable weather holds. And although Brazil has notoriously faced transportation and logistical issues at ports in the past, that is much less the case today. The upcoming 2016/17 export season could be one of the smoothest Brazil has seen in recent years. And if domestic soybean and corn prices are internationally competitive once the products arrive to market, the United States, one of the country’s main trade rivals, will start feeling the pressure.
