Soybean production forecasts vary but all seem to be lower
By Colin McNaughton
Farms.com Risk Management Intern
The 23/24 Brazilian soybean production year is facing challenges due to unfavorable weather conditions, leading to a notable decline in production estimates compared to initial projections. The forecasted rains, critical for crop development, have proven to be unreliable, contributing to increased stress on soybean crops. Over the weekend, Brazil experienced light and scattered showers, particularly in the center-west, parts of the center-south, and much of the northwest regions.
Looking ahead, the weather forecast for the next week to 10 days suggests a continuation of similar patterns hot & dry, raising concerns about intensifying crop stress, especially for crops struggling with insufficient moisture. 75% of the Brazil soybean production in grown in the North/Center where its hot and dry and 25% in the South where it remains very wet.
In contrast, there is a more favorable outlook for the southern regions of Brazil and Argentina, offering a mixed forecast that could benefit agricultural conditions in those areas. Despite the challenging conditions, soybean production forecasts for the current period vary among different sources, indicating a reduction of 5-10 million metric tons (mmt) compared to the previous year. But heading into the critical pod filling stage in Dec/Jan like July/August in North America if the rains do not fall production will be reduced even further.
Various organizations have provided differing soybean production estimates for Brazil AgRural lowered its projection to 159.1 mmt from the prior 163.5 mmt, while Stonex estimates 165 mmt, Agresource Brazil 162.4 mmt, Agroconsult 161.9 mmt, Datagro 156.5 mmt, Safras 161.3 mmt, and Hedgepoint 160.1 mmt. On the lower end, Patria AgroNegocios and Agrinvest project 150.4 mmt and 155.4 mmt, respectively. South American crop scout Dr. Cordonnier maintained unchanged estimates for Brazil's corn and soybean crops at 121 mmt and 158 mmt, expressing a lower bias for both crops.
The USDA, as of Friday, projected the 2023/24 Brazilian soybean crop at 160.16 mmt, which is too high if anticipated rains do not materialize in the next 60 days. CONAB lowered its outlook for Brazil's crop to 160.177 million tons, a 1.4% decrease from November but 3.6% higher than the previous year at 156 mmt.
The combined total between Argentina and Brazil production will be off, but the earlier high projections but could still come in at a record 200 mmt. But Argentina is the #1 global meal exporter while Brazil is the #1 global soybean exporter so Argentina’s higher production after last years drought will offset Brazil but the U.S. soybean export program will win in the end.
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