January 6, 2006

Brazil ups 2005/06 soy crop estimate to 59.2 million tonnes

The Brazilian Census Bureau, or IBGE, said in their second soybean crop estimate that Brazil would harvest an estimated 59.2 million tonnes of soy in the 2005/06 crop, up from the 58.7 million tonnes they estimated in October 2005.

The soy harvest begins in February in some states.

IBGE estimated on Thursday that soy production in the 2004/05 crop was 51.1 million tonnes.

Soy production will grow by roughly 15.8 percent over 2004/05 harvest, but planted area will be reduced by 6.14 percent to 23 million hectares because of crop losses due to dry weather in the previous season that ultimately added to liquidity problems on Brazilian soy farms.

IBGE said in their report that they expect soy prices to fall because of high world stocks, a good US soy harvest and high expectations for a bumper soy crop in Brazil, Argentina and Paraguay.