Brazilian maize (corn) prices continue to trend lower than the levels seen at the beginning of the year, falling to R$726.13/MT on 3rd June (-11.5%) compared to R$820.11/MT on 1st January. Brazilian maize prices mirrored declines in the global maize market, which saw the US CBOT maize price drop to more than a decade low on 29th April, pressured by weaker consumption, especially from the ethanol sector. The lower demand was a result of the lockdown measures imposed due to the coronavirus pandemic, resulting in ample maize supply availability.
The surplus on the global maize market is weighing on Brazilian maize prices, particularly as the country is currently harvesting the second maize crop - ‘safrinha’. According to the USDA, Brazil is forecast a record maize crop for the second consecutive year in 2019/20, at 101 million tonnes.
However, a low Brazilian real (BRL) against the US Dollar (USD) might improve export demand for Brazilian maize, which will likely support prices in the medium term. Brazilian maize prices quoted in USD were at a significant discount for the same reported period, trending at $143.9/MT - down 29.5%.