July 12, 2004

Agroconsult Pegs Brazil 2004-05 Soy Production Up 33% At 65.7 Million MT

Brazilian soybean output will reach 65.7 million metric tons in the 2004-05 season (October-September), some 33% higher than the 49.3 million tons produced in the weather- and disease-affected last crop, local analytical firm Agroconsult said Friday.

"The estimate is based on the expectation that losses due to dry weather and Asian rust will not be repeated," said Guilherme Bastos, an Agroconsult analyst.

This is the first estimate for the next crop released by a local consultancy.

The expansion will be fueled by a 7.5% increase in soybean planted area to 22.8 million hectares from 21.3 million this year, and a return to normal yield levels, pegged 24% higher than the year before at 2,874 kilograms per hectare.

The growth of soybean area planting has actually reduced this season after growing at over 10% for the last couple of years due to sliding international prices and increased costs of production, especially for fertilizers, said Bastos.

The biggest growth in planted area will once again be in the frontier states of the center-west. Mato Grosso do Sul will see area rise by 15% to 2.1 million hectares next year, while Mato Grosso, Brazil's No. 1 soybean state, will see planting jump 11% to 5.7 million hectares, said the survey.

In the south, expansion will be more sedate. In Parana, the No. 2 soy state, area is expected to rise 3% to 4.5 million hectares in 2004-05.

However, the biggest expansion in area in percentage terms is in the new soybean states in the north and northeast. Area is seen jumping 35% to 220,000 hectares in Piaui state and 18% to 400,000 hectares in Maranhao state.