Brazil agency cuts wheat crop view, puts ending stocks at 20-year low – Conab
By Roberto Samora
SAO PAULO, Dec 7 (Reuters) – Brazilian crop agency Conab on Thursday reduced the country’s wheat output estimate by around 15% from a previous forecast, citing excessive rainfall in southern Brazil as a factor spoiling the crop as the season draws to a close.
Brazilian wheat production is now estimated at 8.14 million
tons for 2023, the second largest volume in the country’s history, behind only the 10.55 million tons farmers produced in 2022.
According to Conab, lower supplies, a sudden rise in wheat exports from Brazil in recent years, and a drop in imports from January to October 2023 will take Brazil’s inventories to the lowest level in about two decades.
Overall, Brazil is a net wheat importer and its main supplier is Argentina.
A dearth of supplies has also caused prices paid to growers to rise almost 30% in the past 30 days, Conab said.
Excessive rains in southern Brazil slashed yields in large producers Parana and Rio Grande do Sul states, said Conab.
Rio Grande do Sul in particular suffered from “voluminous rains, winds, hail, floods, lots of clouds and few days with sunshine in all regions of the state.”
This affected wheat quality and disrupted disease control management, according to the agency.
With the fall in 2023 production, Conab believes Brazil will have to increase wheat imports by 600,000 tons in relation to
a previous forecast, demanding a total of six million tons in the 2023/24 cycle (August/July).
Brazil is also likely to export 2 million tons of wheat in that period, 600,000 tons less than Conab had predicted last month.
Conab said Brazil’s wheat ending stocks on July 31, 2024 are expected to reach the lowest levels in more than two decades, citing historical data.
Inventories will be just over 240,000 tons, compared with 740,000 tons a year earlier and around 2 million tons in recent years, Conab data showed.
Source Link :- https://www.nasdaq.com/articles/brazil-agency-cuts-wheat-crop-view-puts-ending-stocks-at-20-year-low-conab
