March 26, 2025 | 14:48 GMT +7

  • Click to copy
Wednesday- 14:48, 26/03/2025

Brazil faces inflation risks as surging corn prices eclipse rice plunge

(VAN) Corn prices in the Campinas region have surged past 90 reais ($15.80) per 60-kg bag, the highest nominal level in nearly three years, marking a more than 23% jump year-to-date, according to the widely followed Cepea index from the University of Sao Paulo.
A sign saying that credit card are accepted is seen on a corn vendor cart in a street in Sao Paulo, Brazil August 16, 2018. 

A sign saying that credit card are accepted is seen on a corn vendor cart in a street in Sao Paulo, Brazil August 16, 2018. 

Brazil is set to face inflationary pressure from rising corn prices, which could overshadow a sharp drop in rice, as President Luiz Inacio Lula da Silva's administration struggles to contain public discontent over high food inflation.

Corn prices in the Campinas region have surged past 90 reais ($15.80) per 60-kg bag, the highest nominal level in nearly three years, marking a more than 23% jump year-to-date, according to the widely followed Cepea index from the University of Sao Paulo.

That contrasts with paddy rice prices, which have dropped below 80 reais per 50-kg bag in Rio Grande do Sul for the first time since October 2022.

Rice prices have slumped due to an expected 15% rise in Brazilian production driven mainly by a recovery of Rio Grande do Sul's harvest, and improved global supply.

Conversely, corn prices have climbed amid low starting stocks, robust demand from the ethanol and meat industries, and the development of Brazil's second corn crop amid weather uncertainty.

"A major risk for food (inflation) is corn, the main input for poultry, pork, and cattle feed, including both meat and dairy production," consultancy Datagro said on Tuesday.

Datagro expects inflation to exceed the 3% official target with a 4.5% upper tolerance band, as food prices weigh on Lula's declining approval ratings.

The consultancy estimates corn's surge could push food inflation up by 1.07 percentage points over six months, with a broader impact on consumer prices of up to 0.47 percentage points.

A further drop in rice prices, the fifth most significant food item in Brazil's inflation index, could help ease inflation, but the cereal has already declined 3.99% over the past 12 months, economist Andre Braz of FGV IBRE noted.

Meanwhile, poultry, beef, and pork prices - which are all impacted by corn costs - have jumped 10.95%, 21.47%, and 20.22%, respectively, he stressed.

H.D

(Reuters)

Breaking cycle of forest land grabs

Breaking cycle of forest land grabs

(VAN) Thailand’s efforts to address landlessness among its population has been a priority for multiple administrations.

Engaging the next generation in the connection between forests and foods

Engaging the next generation in the connection between forests and foods

(VAN) FAO, together with the Government of Italy, and a forest expert and a master ice cream maker from Italy, educate young students on the significance of forest foods at FAO Park.

The glyphosate debate

The glyphosate debate

(VAN) The EU has recently approved the use of glyphosate for another decade. Bárbara Pinho examines the controversial pesticide’s presence in British farming and considers the possibility of a ban in the UK.

The spread of H5N1 highly pathogenic avian influenza calls for stepped up action, FAO says

The spread of H5N1 highly pathogenic avian influenza calls for stepped up action, FAO says

(VAN) Averting losses of hundreds of millions of poultry crucial to mitigate impacts on food security, nutrition and affordability of poultry products.

Indonesia's cocoa farmers work with businesses to fight the bitter impact of climate change

Indonesia's cocoa farmers work with businesses to fight the bitter impact of climate change

(VAN) The loud whirr of a chainsaw sounds through the forest as a small group of farmers gathers around a tree filled with red seed pods. With one slow stroke, a severed knobby branch hits the ground.

Advancing sorghum science: A drought-resilient crop for agriculture's future

Advancing sorghum science: A drought-resilient crop for agriculture's future

(VAN) The importance of this cereal lies in its role in the future of human and animal nutrition, providing a sustainable alternative for areas facing water scarcity.

Read more