Wheat crop 20% must retreat in 2017/2018

Sao Paulo-the production of wheat should go back in Brazil in 2017/2018 crop, which is in the process of planting. As the wheat industry Union in the State of São Paulo (Sindustrigo), the loss is a result of the break in production combined with a reduction in acreage.
The expectation of the Sindustrigo is that production in the next cycle reach 5,300,000 tons 6,700,000 tons of vintage ante 2016/2017, based on market data and information obtained from the field. "Yet this is a perfectly acceptable number considering that supplies at least half of the market," says the President of the Union, Christian Saigh.
According to him, only the State of São Paulo should have 10% loss in production. "I believe that the low profitability is also a factor in this reduction," says the Manager. The value of the ton of wheat was in R $1000 a tonne a year and retreated to the current R $700. "This discourages the producer."
According to the Executive of Bunge wheat in Brazil, Edson Csipai, production must be smaller due to the rains. Were 400 mm in Rio Grande do Sul, where, until last week, planting was 10% ante 50% area previous cycle. "But with the end of the rains the acreage already advanced to 40% this week," he said, adding that it is still not possible to estimate how much will be lost.
"We still have three to four months to dilute these losses," says Csipai. With 71 percent of the crop sown, the estimate is retraction of the production area of 2,100,000 hectares to 1,900,000, according to the national supply company (Conab).
Grinding
The prospect is also in the production of flour retraction, President of Sinditrigo. "If what we saw in the first four months of the year is maintained until December, we will have a 5.3% retracement", designs Saigh.
Considering only the State of São Paulo, the recoil was 5%, the equivalent of 8000 tonnes less per month and a production of 142,000 tons monthly. "If that continues throughout the year will be 96000 tons of wheat flour."
The estimate goes against the Union''s initial forecast of stability over the past year. "We have 14 million unemployed and the consumption is directly affected by the low incomes of the population," explains the President of the Union.
In this scenario, the companies act with tight margins because of the difficulty of passing on the increased costs to the consumer. "What concerns the industry is know who we''re going to sell the flour more than who we''re going to buy," says Saigh.
The Argentina must have expressive participation again in the Brazilian imports. Csipai, Bunge, the neighboring country to produce 20 million tons of wheat in the 2017/2018 cycle and export 13 million tons. "Brazil must import 4,500,000 tons." In 2016, were 3,900,000 tonnes.