Brazil's corn production is expected to rise slightly to a record 74 million metric tons in 2012-2013, according to the U.S. Department of Agriculture's Brasilia attache, even as farmers shift to grow more soybeans because of high prices, transport logistics and better liquidity.

The USDA attache forecasts corn production will rise 1.7% on the year in 2012-2013, predicated on availability of improved seed varieties, an increase in the planted area and average rainfall, after drought afflicted 2011-12's first crop in some regions.

The attache expects the planted area to increase slightly to 15.3 million hectares, from 15 million hectares in 2011-12. That marks a downward revision from the USDA's official forecast of 16 million hectares as farmers shift to soybean production.

Corn exports are forecast at 17 million tons in 2012-13, the USDA attache said, as Brazil gains new customers, but levels will be tempered by logistics issues such as port congestion and increased transportation costs. A new law limits the number of hours truckers can work and increases mandated breaks.

The USDA attache said Brazilian trucks also experience more wear and difficulty hauling corn, as opposed to soybeans, given its different characteristics such as weight and uniformity. It added that many producers in logistically-challenged locations like Mato Grosso may evaluate second crop corn production with more scrutiny as logistical and transportation costs "eat away their bottom line."

Write to Michael Haddon at michael.haddon@dowjones.com or on Twitter @MichaelHaddonDJ

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(END) Dow Jones Newswires

October 19, 2012 06:02 ET (10:02 GMT)