Agriculture research firm Safras & Mercado said Friday it expects Brazil to harvest a 63.26 million metric tons of corn during the current 2011-12 crop year, down 3.7% from its initial forecast.

Scarce rainfall in southern Brazil during recent months--the result of a La Nina phenonmenon--has damaged crops and left expected productivity well short of potential. The losses have been particularly severe in the southernmost states of Rio Grande do Sul and Santa Catarina.

"In Parana [state], on the other hand, farms surprised with a good recovery," Safras & Mercado said in a press release.

Despite the losses in southern Brazil, Safras & Mercado sees the country producing 13% more corn than in 2010-11 and setting a record for output.

That gain should come on the back of greater planted acreage, as well as expanded use of improved or genetically modified seeds.

-By Paul Kiernan, Dow Jones Newswires; (+55)11-3544-7074, paul.kiernan@dowjones.com

(END) Dow Jones Newswires

March 16, 2012 13:52 ET (17:52 GMT)