Government resumes policy of public stocks and will buy 500 thousand tons of corn

This Thursday (29), the federal government made official the policy for the acquisition of products for the formation of public stocks through the National Supply Company (Conab). The return of the so-called “regulatory stocks” was a campaign promise by President Luiz Inácio Lula da Silva (PT) and will start with the purchase of 500 thousand tons of corn.

The acquisition will be carried out through the Federal Government Acquisitions mechanism (AGF), provided for in the Minimum Price Guarantee Policy (PGPM), and is equivalent to approximately 8.3 million 60-kilogram bags of cereal. The measure was authorized by the Ministry of Agriculture and Livestock (MAPA).

Producers from Goiás, Bahia, Mato Grosso do Sul, Mato Grosso, Paraná and Tocantins are authorized to sell corn to the Federal Government. The sales limit per producer varies according to the state: In Mato Grosso, each farmer can sell up to 30,000 bags to the state-owned company.

In Mato Grosso do Sul and Goiás, the limit is 10,000 bags, while in other authorized states, purchases are limited to around 3,300 bags.

The purchase will only be finalized by Conab if the product meets the required standards. The cereal purchased may be stored in Conab’s own warehouses or in a storage unit accredited by the state-owned company. The purchase was authorized by the Ministry of Agriculture due to the fall in the price of corn on the domestic market.

The forecast for record production in Brazil in the second harvest, combined with an appreciation of the real against the dollar, among other factors, reinforce the scenario of devaluation of grain prices, especially in the second half of this year, when there will be an intense entry of offer of the product in the world market with harvests in the United States, Europe and Brazil.