The record output is expected to lead to record exports as well, with the USDA estimating Brazil’s corn exports at 35 million tonnes in 2016-17, up sharply from 13.996 million tonnes in 2015-16.

“The large supply of corn (and resulting low prices) has made Brazilian corn very competitive in the international market,” the USDA noted in its report. “With a record soybean harvest, farmers have faced a dilemma over the use of limited storage in country. Many farmers use silo bags for short-term on-farm storage and have opted to store soybeans in anticipation of improved prices, while selling corn at break-even prices or even losses. Nevertheless, the record crop is expected to result in higher ending stocks, as farmers and traders will be unable to entirely move the larger volume of supplies into consumption or exports.”

 In light of the record output in Brazil, corn consumption in 2016-17 is forecast at 59 million tonnes, up from 57.5 million tonnes in 2016-17, the USDA said. The record-setting crop has led Brazil to look for alternative uses for corn, and in August the country inaugurated its first corn-only ethanol plant, located in Lucas do Rio Verde, Mato Grosso. The plant is a joint venture between U.S.-based Summit Agricultural Group and Brazil-based Fiagril Participações. According to the USDA report, the plant has the capacity to produce 240 million liters of ethanol each year.

Looking ahead to the 2017-18 marketing year, the USDA said corn production is forecast lower than 2016-17 but still high, at 95 million tonnes. Exports in 2017-18 also are forecast to stay strong, at 35 million tonnes, while consumption is forecast slightly higher at 60 million tonnes.