November 10, 2011
Brazilian soy output to decrease
In spite of being the world's number two soy producer, Brazil is seen potentially to experience its biggest dip in soy output in decades as farmers increase corn cultivation to capture more attractive prices, according to the government on Wednesday (Nov 9).
According to Reuters, the 2011/12 soy crop that is in the peak of planting is expected to produce 71.48-72.96 million tonnes, down from October's estimate of 72.18-73.29 million tonnes, the agriculture ministry's crop supply agency Conab said.
If confirmed, the crop could turn out to be 3-5% less than the record 75.32 million tonnes harvested from the 2010/11 crop, the biggest annual drop in several decades.
In the second forecast of Brazil's new grain crop, technicians from Conab did not travel into the field as they did in October but rather updated their estimates based on data collected remotely by phone, satellite and email.
The agency said that the area planted to soy would grow from last season by 1-3% to a record 24.4-24.9 million hectares. But this is lower than Conab's October area estimate of 24.7-25 million hectares for the crop.
Meanwhile, Conab raised its forecast for corn to 58.42-59.45 million tonnes, from October's estimate of 57.32-58.98 million tonnes, as producers focus on optimising output of the crop to capture favourable international prices for the coarse grain.
Area to corn, which shares the same fields as soy, is seen growing by just over 5% from last year to roughly 14.55 million hectares, Conab said.
Brazil harvested 57.51 million tonnes of corn in 2010/11.
Although a large local poultry and pork industry consumes most of the country's corn output, Brazil has become the world's third largest exporter of corn in recent years, shipping between eight million and 11 million tonnes annually.