December 10, 2010

Brazil firms up estimate for almost-record soy harvest

Brazil hardened its soy crop projection nearly equal to last year's record, pegging it at the top end of the previous output range in spite of downgrades by other analysts concerned over La Nina effects.

The government's crop supply agency Conab said the crop would produce 68.6 million tonnes, just shy of the record 68.7 million tonnes harvested last year, and at the top of the 67.7-69-million-tonne range it issued last month.

Today's forecast, Conab's third this season, came despite spring rains that were a month late to the centre-west soy belt. Some southern farms have also suffered about three weeks of dry weather during the peak of planting.

With expectations of an intensifying La Nina weather anomaly bringing more dry weather, USDA attache, as well as local analysts and the industry, have lowered their outlooks for the world's No. 2 soy exporter after the US.

On Monday (Dec 9), the USDA attache cut his estimate to 66.8 million tonnes from 67.5 million previously due to dry weather in Brazil's No. 3 soy state Rio Grande do Sul and a smaller-than-expected planted area.

Earlier Thursday (Dec 8), local grain crusher group Abiove lowered its outlook for the new crop to 67.2 million from 67.9 million tonnes in October. Also this week, private analysts Agroconsult cut its view by 1.2 million tonnes to 68.4 million tonnes, whereas Celeres sliced by one million to 68.1 million tonnes.

Conab said the area planted to soy is estimated at 24.08 million hectares (59 million acres), consolidating near the high end of the November range of 23.7-24.2 million hectares.

Conab also said Brazil's total corn output for the season would reach 52.56 million tonnes, compared with a range between 51.8 million and 52.7 million tonnes seen in November. Corn area seen at 12.68 million hectares has given up some ground from last season's 12.97 million hectares to soy and cotton.

In 2009/10, Brazil harvested 56 million tonnes of corn.