Brazil sees record soy output

National yields reached a record 2.9 tonnes per hectare supported by favourable El Nino weather and record yields in southern Brazil.

However, potentially higher yields were not reached due to high humidity, reduced sunlight and increased disease and pest pressures.

Post forecasts a return to historical record area planted in 2010-11 at 23.3 million hectares producing a record 67.5 million tonnes. Soy maintains a lower relative production cost and greater liquidity compared to alternative crops.

Exports in 2010-11 are expected to remain strong and are forecasted at 28.75 million tonnes. Domestic demand for soyoil is projected to increase 100,000 tonnes per year based on Brazil's current 5% biodiesel blend mandate.

Post raised 2009-10 estimated soy production to 67.25 million tonnes based on national average 2.9 tonnes per hectare yields and an increased planted area of 23.2 million hectares. Increases resulted from favourable El Nino weather conditions, increased planted area substitution from corn to soy in southern Brazil and record yields in southern Brazil.

In the Central-West and Northeast regions, potential yields were not reached with smaller bean size reported due to varying factors during the growing season including high humidity, reduced sunlight, increased disease and pests. In addition, scattered wet harvest conditions throughout Brazil have affected yields and quality. Yields in the Central-West appear also to have been negatively affected by adulterated fertiliser where studies conducted indicate package specifications were not met.

Average yields in Brazil continue to improve with rapid adoption in the latest production and machine technology and development of better soil management techniques. States with shorter rainfall seasons utilise large-scale crop rotation schemes in order to maximise profits while seeking to retain water moisture levels.

According to Brazil's National Animal Feed Industry Syndicate (Sindiracoes), total feed demand in Brazil is expected to increase at least 6% in 2010, on top of a 5% increase in 2009. In 2009, corn accounted for 55% of total animal feed, while soybean meal accounted for 16.5%.

Soymeal demand for 2010 is estimated at 11.2 million tonnes compared to 10.5 million tonnes in 2009. Poultry feed rations utilise the highest ratio of soymeal at 18%, demanding 5.2 million tonnes in 2009.

Cottonseed meal utilised in dairy and beef cattle feed rations increased 9% from 2008 to 2009. The dairy industry utilized twice as much cottonseed meal as the beef cattle industry with less than 3% being used in other animal feed rations. Cottonseed demand for 2010 is estimated at 1.45 million tonnes compared to 1.33 million tonnes in 2009.