Paraguay sorghum to Brazil surges nearly 10× above norm

Possible drivers

The most plausible explanation sits in corn prices. The 2024/25 crop cycle saw elevated corn prices across several quarters, driven by tighter South American production and sustained Chinese buying. When corn prices rise, feed mills and integrators shift a portion of ration formulations toward sorghum, which typically trades at a discount. Paraguay would have been a natural supplier: close, tariff-free under Mercosur, and with growing sorghum output as farmers rotate out of soy. Logistics reinforce the story. Paraguay shares a dry border with Brazil's Mato Grosso do Sul and Paraná states. Road freight into Brazil's main feed-producing regions is competitive, avoiding the congestion that plagues port-dependent routes. With zero Mercosur tariffs, the only remaining brake was relative price — and in 2025, that brake released.

Supplier diversification may also be a factor. Brazil has historically imported sorghum from the United States and Argentina. A favorable price window in Paraguay, combined with available logistics capacity, could have attracted Brazilian buyers testing the corridor at meaningful scale for the first time.

The macro frame

Brazil is Latin America's largest animal feed market. Sorghum's share of feed formulations typically sits between 5% and 10% in normal years, according to CONAB data — but can rise sharply when the corn-sorghum spread widens. The poultry and pork sectors, concentrated in Paraná, Santa Catarina, and Rio Grande do Sul, are the main buyers and would benefit from a reliable, road-accessible sorghum supply. Paraguay has been quietly expanding sorghum cultivation as a rotation crop alongside soy. Surplus production had historically found buyers in Argentina and Bolivia; Brazil now appears on the map at scale. The 2025 volume suggests the corridor found its price clearing point.

Signals to watch

With no 2026 YTD data yet available for the corridor, it is too early to call this a structural shift. The 2025 volume may reflect concentrated purchasing in discrete windows — one large buyer, one bumper crop. Or it may mark the start of a recurring trade lane. The data point that will tell: the corn-sorghum spread over the next two to three quarters. If the differential holds above the formulation threshold, buyers return. If corn softens, Paraguay likely reverts to historical volume.

What this means for you

For exporters: Paraguayan grain originators operating out of Concepción or Alto Paraná should evaluate direct supply agreements with Brazilian integrators before the corridor becomes fully priced in. The logistics cost advantage is structural, not cyclical. For importers: Brazilian feed mills should track the corn-sorghum spread weekly. If the differential holds above the formulation threshold, the Paraguay corridor will remain active — and locking in forward supply could be cheaper than spot procurement. Sorghum traders working this corridor in 2022 would not recognize these volumes today.

Primary source: MDIC ComexStat. Sector reference data: CONAB.