October 5, 2004

Celeres Holds Brazil 2004-05 Soy Crop View At 64.2 Million MT

Brazilian agricultural consultancy Celeres held its Brazilian soybean output estimate for 2004-05 at 64.2 million metric tons in its October estimate.
 
"We did not detect any concrete reasons to alter 2004-05 soybean intentions," said a weekly report.
 
Output is pegged some 26% higher than last season as yields return to normal after last year's weather and disease problems and planted area increases.
 
Planted area is seen jumping 7.6% to 22.9 million hectares from 21.3 million hectares last year while average yields are seen rising 16.9% to 2,802 kilograms per hectare from 2,397 kg/hectare.
 
Celeres said the main growth will be across abandoned pasture in the south and center-south. Soybeans are also seen eating up land previously planted with corn.
 
However, in the more established agricultural regions of Mato Grosso and Bahia state, soybeans will probably lose ground to cotton, the report added.
 
Farmers are putting off the decision to plant in the hope that prices would react and also because of problems obtaining credit this season. Trading companies are offering much less forward credit this year after a sharp jump in prices last year caused heavy losses and legal complaints by farmers.
 
In view of the slow pace of exports this season, Celeres lowered its export projection for the 2004-05 commercial season (February-January) to 19.9 million tons from 20 million tons.
 
In addition, Celeres raised its forecast for 2005-06 carryover stocks by 4.4% to 4.7 million tons, which will be more than double the 2.210 million seen this season.
 
Rains in the early planting center-north region of Mato Grosso state allowed farmers to start fieldwork. However, the region remains dry and more rain is needed in the next weeks for early sowing to be successful.
 
As of Oct. 1, 1% of Brazil's crop had been planted, on a par with last year and slightly ahead of the average over the past five years, said Celeres.
 
The pace of forward soybean sales remains extremely slow with only 9% of the 2004-05 harvest sold, compared with 41% at the same stage last year and a five-year average of 28%, said Celeres' soy analyst Anderson Galvao Gomes.
 
Brazil is the world's No. 2 producer and exporter of soybeans.