Experts continue to reduce forecasts of soybean crop in Brazil

Due to the sharp decline in the forecast of soybean harvest in the largest agricultural state of Brazil Mato Grosso by 20% to 40 mln tonnes, Itaú BBA lowered the forecast of the total soybean production in the country in 2023/24 MY by 5 mln tonnes to 153 mln tonnes compared to the previous estimates.

“If the forecasts come true, the soybean crop loss will be the largest in the history of the state,” – Itaú BBA said.

Meteorologists predicted an increase in precipitation in the Central-Western and North-Eastern regions of Brazil in early December, but the rain was less than usual, which increased the threat of crop loss in arid regions.

Against the background of lowering the forecast of soybean production to 153 mln tonnes and increasing the consumption forecast by 3%, Itaú BBA experts estimated the country’s soybean exports in 2023/24 MY at 95-96 mln tonnes.

At the same time, they expect Argentina to harvest 50 mln tonnes of soybeans in 2023/24 MY, which will be in line with the level of 2022/23 MY, but still worsen the global balance. it is Expected that global demand for grains and oilseeds will increase compared to last year by 5%, which will affect soybean prices.

Powerful downpours that took place this week in Central Brazil, contributed to the development of soybean crops and led to a decrease in January soybean futures to 480,6 $/t, which is 5% lower than last month.

In Ukraine, high export demand and a shortage of supply from producers keep soybean prices high. Exporters offer 18000-19000 UAH/t for soybeans or 450-470 USD/t with delivery to the port, so processors raised prices to 17500-18500 UAH/t with delivery to the plant.

the Projected decline in soybean prices in January may not occur due to uncertainty with the harvest in Brazil. However, better weather conditions will help to increase production forecasts from pessimistic 153 million tons to optimistic 159-161 million tons, as other analysts have said.

Tags: Brazil, soybean, crop forecast