BRAZIL (16 February)

Output of the recently harvested 1997 wheat crop is tentatively estimated at 2.7 million tonnes, 19 percent below the 1996 level but still above average. The decline has been mainly due to the torrential rains which for continuing weeks fell on the main producing southern states of Parana, Santa Catarina and Rio Grande do Sul. Harvesting of the 1998 maize crop has already started in some of the southern key producing areas. Production is forecast to decline considerably from 1997 high production level, mainly as a consequence of reduced plantings. This is principally the result of farmers’ decision to switch to alternative crops attracted by the higher prices relative to maize. In the north-east of the country, where sowing of the 1998 maize crop should start from March, the outlook is poor as dry conditions associated with El Niño have resumed following some rains in January which helped partly restore much needed moisture to the soil. Farmers feel uncertain in their planting intentions, as drier than normal conditions are forecast to remain until April. The majority are subsistence farmers living off their small crops of maize, beans and cassava. Pastures are also being affected by the significant moisture deficit.