SAO PAULO, March 16 (Reuters) - China is actively buying Brazil’s second corn, known as “safrinha,” even as farmers grapple with planting delays in the world’s third biggest producer of the cereal.
According to grain traders, China has bought in advance at least 1.5 million tonnes of Brazil’s safrinha crop, representing more than 10% of total forward sales of the staple product. Farmers have sold an estimated 14 million tonnes of their next safrinha crop, traders said.
The corn already bought will partly be exported from July and partly processed internally, the traders and one analyst said.
Aside from China, buyers of Brazil’s 2023 safrinha corn include Japan and South Korea, the analyst said.
Iran is also a large importer of Brazil’s corn. But, unlike China, it has not been buying ahead, according to one of the traders and the analyst.
An estimated five million tonnes of this year’s safrinha corn already purchased from farmers is destined for export markets, the traders and the analyst said.
Farmers are currently planting Brazil’s second corn, which is sowed after soybeans are harvested in the same fields.
Excess rainfall pushed back the soy harvest this year, meaning some growers will be forced to plant their second corn outside the ideal climate window, which analysts say end in the middle of March. As such, Brazil’s safrinha corn runs a higher risk of facing adverse climate events as the crop progresses.
Brazil plants corn all year round, but the safrinha crop is the biggest, representing 70% to 75% of national production in a given year.
Barring bad weather events, Brazil’s second corn output may be around 96 million tonnes, allowing the country to produce the biggest overall crop in history.
Based on current market expectations, Brazil may overtake the U.S. as the world’s biggest corn supplier for the first time this season, with the USDA projecting Brazilian exports of 50 million tonnes. (Reporting by Ana Mano; Editing by Josie Kao)
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