September 16, 2009

Brazilian farmers have seen favourable weather to start planting and there is talk it could be a record crop, according to soy industry sources Tuesday (September 15).

 

Regulations in Mato Grosso, Brazil's No.1 soy producing state, allow farmers to start planting their new soy crop on Sept. 15. As a result, the first farmers have begun putting their new beans in the ground for the upcoming 2009-10 crop season, industry participants said. Planting will really pick up later this month and in October.

 

Because of wet weather, more fertilizer being used and farmers switching to soy from corn, the soy crop could be Brazil's largest. Most private estimates peg the 2009-10 soy crop in a range from nearly 65 million 60-kilogramme bags from 62 million bags.

 

Leonardo Menezes, an analyst at local consultancy Celeres, said recent higher-than-average rains in Mato Grosso state means ample soil moisture. "This is favourable for the planting," Menezes told Dow Jones Newswires.

 

Menezes said that if the weather continues to be favourable, Brazil could increase its earlier estimate of 64.7 million tonnes for 2009-10, he said.

 

"This year, certainly, has a potential to be a record breaker," Menezes said. It is still, however, early days as the weather can alter any estimates, Menezes added.

 

Daniele Siqueira, a soy analyst at consulting firm AgRural, said a small number of farmers already have their seeds in the ground.

 

Siqueira agreed that higher-than-average rain is providing good conditions to plant in Mato Grosso. AgRural estimates an increase in Brazil's soy area of 3.7 percent in 2009-10 compared to 2008-09. This would lead to a crop of around 63 million to 64 million tonnes, she said.

 

As well as good weather, a trader at a major US soy exporter said that Brazilian farmers are likely to deploy more fertilizer this season as prices for inputs have fallen sharply.

 

Products such as Super Simples that contains phosphorous, cost around US$230 per tonne this season compared to US$450 per tonne last season, the trader said.

 

Aedson Pereira, an analyst at consultancy AgraFNP in Sao Paulo, agreed that with fertiliser and pesticides almost 50 percent cheaper this year, the farmers are able to apply more inputs. Both estimate the new crop at around 62 million tonnes.

 

November soy on the Chicago Board of Trade finished 51 cents higher, up 5.6 percent, at US$9.60 per bushel on Tuesday (September 15).

 

Brazil is the world's No.2 soy producer after the US.