Domestic market of corn remains firm even with available suply

Domestic corn prices remain firm in the final stretch of the 19/20 business year. The volume of shipments and scheduled commitments amount to 36.7 million tons, not including December and January data. This emptying of domestic surpluses coupled with the cut in summer area and irregular weather this spring leave the market volatile and firm in November. Perhaps the situation could be even more aggressive if sharper losses of the US crop were confirmed. Even so, Brazil’s spring weather caused this domestic bullish movement to happen earlier than normal, and growers are now about to confirm the summer crop and the 2020 second season before liquidating stocks. There is no shortage of domestic supply, but prices are relatively high, and the consumer sector, without medium-term stocks, is coping with higher prices now. As long as the domestic market does not supply itself, prices tend to remain firm.

The Brazilian economy has showed some strength of recovery. New positive job creation data confirm that 2019 has been the best at least for the last five years. Civil construction points to resumption, a sector that generates a greater employment movement. Agribusiness has another year of good results, now also with growing exports of the meat sector. However, some variables weigh on the economy, even after the approval of the major pension reform ever registered in the country.