November 9, 2005

Brazil's IBGE estimates 58.7 million tonne of soy crop in 2006
 

The Brazilian Census Bureau (IBGE), forecast Tuesday that soy production will reach 58.74 million tonnes in the 2005-06 harvest (October-September), up 15 percent on the year before, despite a 6.4 percent reduction in overall planting area.

Dry weather destroyed nearly half of the 2004-05 soy crop in southern states such as Rio Grande do Sul, as well as Mato Grosso do Sul in Brazil's central-west.

IBGE's soy crop estimate is slightly more optimistic than the crop estimates released by Brazil's Agriculture Ministry last week, which had production varying between 56.7 and 58.6 million tonnes.

Expectations of a production increase on account of good weather early in the planting season in the south and central-west have boosted production prospects. Soy production is expected to increase 57 percent to 19.7 million tonnes in the southern states of Parana, Santa Catarina and Rio Grande do Sul.

The centre-west region, including Mato Grosso, Goias and Mato Grosso do Sul, is expected to see a 2.3 percent year-on-year increase in production to 29.2 million tonnes of soy this season.

Farmers across Brazil are reducing their soy planted area due to low international prices, liquidity problems, and an unfavourable currency exchange between the US dollar and Brazilian real, IBGE reported Tuesday.

In Mato Grosso, Brazil's largest producer state, soy farmers will reduce their planting by 6.35 percent to 5.8 million hectares. Production will also drop in that state by 3.4 percent to 17 million tonnes.

Overall, IBGE estimates grain, oilseeds and cereals planted area will fall 4.5 percent for the 2005-06 crop, but this will have no adverse impacts on production.

Total production is expected to hit 126.6 million tonnes, compared with 112.8 million tonnes produced in the 2004-05 harvest.