April 2, 2015
Brazil sees new soy production record at 94 million mt
Brazil''s soybean production for 2015/16 is forecast at 94 million metric tonnes (mmt) from the estimated 93 mmt for 2014/15. This, despite a 1% drop in planted area to 31.1 million hectares compared with the estimated 31.4 mmt in 2014/15, according to a US Department of Agriculture Foreign Agriculture Service (USDA FAS) report. In crop year 2013/14, Brazil harvested 86.3 mmt.
Soybean exports in marketing year 2015/16 are forecast to also increase (by 4%) from the previous marketing year to 48 mmt, due to strong demand from China and the expected weak Brazilian currency real through 2015 and 2016. Brazil exports over 70% of its soybeans to China, which is dependent on imports for its soybean supplies.
The USDA FAS report, more commonly known as GAIN [Global Agricultural Information Network] Report, said the planted area diminished because of the relatively low global soybean prices, the economic challenges facing Brazil, and the expected higher interest rates.
However, Brazil, according to the report, may reach a new production record as it continues to adopt better seed genetics.
Farm-level returns for soybeans, which is Brazil''s major commodity, is expected to be lower because of higher production costs arising from weaker real and inflation. For instance in Mato Grosso, the No. 1 soybean-producing state, the cost of production for biotech varieties may reach an average 2,584 reals (US$816) per hectare, or 7% higher than that in 2014/15. Biotech varieties constitute the majority of Mato Grosso''s soy production.