Trouble Brewing in Brazil? Soybean Crop Forecasts Trimmed as Bad Weather Hurts Yields
Agribusiness consultancies AgRural and AgResource on Monday trimmed their forecasts for Brazil's 2021/22 soybean crop due to bad weather, estimating the expected output below the 130 million-tonne threshold.
AgRural said it now expected oilseed output to reach 128.5 million tonnes, down from a previous projection of 133.4 million tonnes, while AgResource pegged the crop at 125 million tonnes from 131 million previously.
Both made their second forecast cuts in less than a month.
AgRural had expected a record soybean crop of 144.7 million tonnes in 2021/22, while AgResource had estimated it at 141 million tonnes prior to a Jan. 6 cut.
AgRural said its new forecast represented an 8.8 million tonne drop from the previous season, adding that it took into account a yield of 52.9 60-kilo bags per hectare, the lowest since 2015/16.
AgRural said the move was due to lower yields expected for Brazil's southernmost states and Mato Grosso do Sul, which were heavily affected by dry and hot weather recently.
It also mentioned lower output expected in top grain producing state Mato Grosso due to above-average rainfall.
The new forecasts are expected to keep soybean prices on an upward trend.
"The market will now price in the below 130 million-tonne forecasts, bringing prices to higher levels," AgResource Brasil's director Raphael Mandarino said.
According to AgRural, 10% of the estimated area was harvested as of Thursday, up 5 percentage points from the previous week and ahead of the 2% seen by this point last year.
CORN
On corn, AgResource cut its forecast for the first crop to 19.91 million tonnes from 23.75 million tonnes, foreseeing a total output of 106.82 million tonnes this year.
AgRural said the harvesting of Brazil's center-south first crop reached 14%, above the 12% seen in the same period of 2020/21 but with "very low yields" seen in the south.
The planting of the 2022 second corn crop, which is sown right after soybean harvesting and accounts for about 75% of Brazil's total corn output in a given year, was estimated at 14%, versus 1.5% a year ago.
AgRural did not provide forecasts for Brazil's corn output.
(Reporting by Gabriel Araujo and Nayara Figueiredo; Editing by Alex Richardson, Mark Potter and Jane Merriman)
