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The last time Brazilian corn prices were this high, farmers were enduring severe drought.
But the current rally is about demand not supply. After months of strong exports and increasing local demand for animal feed, buyers are struggling to replenish stockpiles even after the nation reaped a record crop, according to the University of Sao Paulo research arm Cepea.
Brazil’s corn boom may finally bring some good news to farmers in the U.S., where prices have been treading water amid signs that the impact of record rains on the Midwestern crop won’t be as bad as first thought.
The South American nation’s grain shortage may lead local consumers to start importing in the coming months, according to Guilherme Bellotti, senior agribusinessanalyst at Itau BBA.
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