BRASILIA, BRAZIL — Brazil is poised to once again set a record for soybean production, according to a June 27 Global Agricultural Information Network report from the U.S. Department of Agriculture (USDA).
The USDA forecasts production for 2019-20 at 124 million tonnes as soybean planted area expands by 2.5% to 37 million hectares and yields return to average due to improved weather.
“The planted area expansion rate is constrained by the fact that Brazilian farmers in key soybean producing areas are close to capacity for land expansion that does not involve the costly, multi-year process of converting degraded pasture land,” the USDA said. “In addition, planting decisions next year are more likely to be conservative given the expected diminished soybean demand from the world’s leading importer, China, where swine production has been ravaged by the ongoing outbreak of African swine fever.”
It also noted that planted area may be revised if the U.S.-China trade tensions ease and an agreement is reached.
“Should the U.S.-China talks be concluded, market analysts in Brazil expect that Beijing will decrease its soybean purchases from Latin America in favor of sourcing more beans from the United States,” the USDA said.
The USDA revised Brazil’s 2018-19 soybean output upward to 116 million tonnes as weather conditions improved late in the season.
Brazil is forecast to export 75 million tonnes of soybeans in 2019-20, according to the USDA, up from 69 million tonnes in 2018-19.