BRASILIA, BRAZIL Brazil is expected to become the leading soybean producer worldwide surpassing the United States, according to a Dec. 27 Global Agricultural Information Network report from the U.S. Department of Agriculture (USDA).
During the 2019-20 season Brazils soybean planted area forecast is revised up to 36.8 million hectares due the weakening Brazilian real against the U.S. dollar. The report notes these price developments pushed some producers to plant a larger area of soybeans than usual.
Additionally, producers are keenly following the emerging trade truce between the U.S. and China, the report said. Producers are cognizant that a trade accord between Washington and Beijing is almost certain to lessen Brazilian exports and exert downward pressure on Brazils soybean prices.
In comparison, the World Agricultural Supply and Demand Estimate (WASDE) issued by the USDA expects U.S. soybean harvest less than 100 million tonnes in 2019-20, a drop of 20% compared to the previous season. Inclement weather negatively affected the U.S. soybean crop in both the planted area and yields.
In market year 2019-20 Brazil is forecast to export 75 million tonnes of soybeans, but the report expects a reduce in demand from China due to the ASF outbreak and a possible trade agreement between the United States and China.
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The U.S. Department of Agricultures Foreign Agricultural Service (FAS) recently reported that a successful 2019-20 growing season will place Brazil as the top global soybean producer, with FAS forecasting planted area at 36.8 million hectares for the season. The forecast was raised from the prior update due to market exuberance over soybean prices in the last several months.
According to FAS, the Brazilian real weakened against the dollar from about 4.09 reals to the dollar in October to 4.17 reals for the first two weeks of December. This pushed some producers to sow a slightly larger area than they otherwise would have, FAS explained.
Notably, the area expansion could have been larger if the local market believed that global soybean consumption would be higher. There is still a lot of consternation over dampened Chinese demand due to the widespread prevalence of African swine fever (ASF), which has decimated swine herds and curbed feed needs. Additionally, producers are keenly following the emerging trade truce between the United States and China.
The 2019-20 production forecast is based on a return to trend-line yields after the current season was adversely affected by inclement weather. FAS said as long as local weather across the key producing states does not deteriorate significantly, Brazil is expected to achieve the top spot.
According to a recent report from USDA, Brazil is forecast to overtake the U.S.as the leading worldwide soybean producer during the 2019-20 season. The USDA Foreign Agricultural Services Brasilia post has revised up their forecast for 2019-20 soybean planted area to 90.9 million acres, based on the market exuberance over soybean prices in the last several months.
The Brasilia post forecasts a record crop for the 2019-20 year, at 123.5 million metric tons. According to the forecast from the World Agricultural Supply and Demand Estimate (WASDE) issued by the USDA, the U.S. soybean harvest will be less than 100 million metric tons in 2019-20, a drop of almost 20% on the previous season. Brazilian soybean exports are forecast at 75 million metric tons for 2019-20.
The Brazilian real has weakened against the dollar from about R$4.09 in October to R$4.17 to the dollar for the first two weeks of December. The Brasilia post believes these price developments pushed some producers to sow a slightly larger area than they otherwise would have and that the area expansion could have been larger if the local market believed that global soybean consumption would be higher. Anxiety reportedly remains over dampened Chinese demand due to the widespread prevalence of African Swine Fever (ASF), which has impacted swine herds and reduced feed needs.
The Brasilia post forecasts domestic meal consumption to increase by 4%, as livestock and poultry industries continue to expand production to meet rising global demand. As a result, meal exports are forecast to remain nearly flat. There is rising potential that Brazil and China will conclude an export agreement for soybean meal. However, in order for Brazil to be able to exportsoybean meal to China, it would also need to conclude a separate sanitary and phytosanitary (SPS) agreement, meaning that Chinese market access is unlikely to come in the near future.
The report forecasts soy oil exports to level off in 2019-20 to 500,000 metric tons from 1 million metric tons in the current season. The forecast is based on the expected surge in demand from the domestic biodiesel industry.
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Emma Penrod has covered science and business, with an emphasis on health, the environment and agriculture, for more than a decade. Penrod covers the animal feed industry for FeedStrategy.com and can be contacted at [emailprotected]. See all author stories here.
CEDAR RAPIDS (AP) ? An Iowa State University expert says long-term trends and recent weather patterns have put Brazil in a position to overtake the United States as the world?s leading producer of soybeans.Chad Hart is a grain markets specialist at Iowa State, and he says the market change ?has been building over a long period of time, but this year will be a milestone.?Hart told The Gazette of Cedar Rapids ...
CEDAR RAPIDS (AP) ? An Iowa State University expert says long-term trends and recent weather patterns have put Brazil in a position to overtake the United States as the world?s leading producer of soybeans.
Hart says that although Brazil may replace the United States as the world?s largest producer of soybeans, soybeans will continue to be profitable for U.S. growers. And, he says, U.S. dominance for corn production will continue.