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Brazil's second corn growers delay fertilizer purchases, says analyst

FILE PHOTO: A farmer uses a machine to collect corn at a plantation in Maringa, Brazil, July 13, 2022. REUTERS/Rodolfo Buhrer

SAO PAULO (Reuters) - Growers of Brazil’s second corn crop, which will be sown after soybeans are harvested early next year, are in no rush to buy fertilizers like urea and the NPK mixture, according to data released by Agrinvest analyst Jeferson Souza on Monday.

He estimated that 75% of everything second corn growers are going to need has been purchased by farmers nationwide, below a five-year average of 83%.

“Growers have noticed a sharp drop in farm input prices and delayed purchases to try and raise production margins,” Souza said in a report.

Fertilizers are used to improve crop yields, and Brazil depends on imports for about 85% of its demand.

In Mato Grosso, Brazil’s top grain-producing state, farmers had purchased 89% of estimated fertilizer demand for this year’s second corn crop, four percentage points below the historical average, data compiled by Souza showed.

Fertilizer purchases, according to the data, are 13 percentage points below last year’s figure in Parana, which is the second-biggest state in terms of demand.

Brazil’s second corn crop equates to about three-fourths of national output in a given season, and allows the South American nation to be a competitive exporter in global markets after the harvest.

Farmers in Brazil normally sow their second corn crop after soybeans are reaped, and any issues affecting development or harvesting of the oilseed can potentially delay second corn planting.

Dryness in center-west states like Mato Grosso is worrying soy growers, but weather problems in some regions have not yet significantly affected expectations for large corn and soybean crops in 2022/2023.

Reporting by Ana Mano; Editing by Paul Simao

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