January 16, 2012

Brazil's drought lowers 2011/12 expected soy output

Brazil's 2011/12 soy production expected to reach 74 million tonnes, down one million from last month and down 1.5 million or 2% from last year, according to a USDA report.

Yield is forecast at 2.96 tonnes per hectare, down 1% from last month due to below-average rainfall in the south during November and December. Area is forecast at a record 25 million hectares, unchanged from last month and up 0.8 million or 3% from last year. The planting pace was ahead of the five-year average throughout the planting season, with most of the crop planted by the end of December.

Above-average rainfall during October gave nearly ideal planting conditions for most of Brazil. However, below-average rainfall in the south during December reduced potential yields, especially in regions that were planted early where crop stage was in the critical flowering and pod-filling stages during December's drought.

Harvesting started this month in Parana, the second-largest soy producing state, which reported below-average yields in the early-planted regions located in the western and southwestern portions of the state. DERAL, the state crop estimating agency for Parana, also reduced their soy production forecast this month by 1.4 million tonnes (from 14.1 to 12.7 million tonnes) due to December's drought and low reported harvested yields in western Parana. In contrast, seasonal rainfall was beneficial in central and northeastern parts of Brazil. Mato Grosso, the largest soy producing state in the central west, is expecting a record soy harvest of 22.2 million tonnes and above last year's record crop of 20.4 million tonnes.