March 31, 2022

Abiove lowers projections for Brazil's soy crop

Brazil soybean crusher group Abiove said it has slashed its projections for Brazil's soy harvest this season to 125.3 million tonnes, 7.7% lower compared to the end of January this year to reflect the season's harvest and the impact of drought, Reuters reported.

Abiove still expects local crushers to process a record 48 million tonnes this season despite a reduction of 10.5 million tonnes from the previous forecast, reflecting strong margins to make soy oil and soymeal in Brazil.

Abiove represents major commodity firms such as Cargill and Bunge. Brazil is the biggest supplier of soybeans in the world.

Brazil is expected to ship 77.7 million tonnes of soybean this season or 9.2 million fewer tonnes, which could mean that US competitors are taking in more orders during a time when Brazilian exports should be peaking.

Daniel Furlan Amaral, chief economist at Abiove, said companies are dealing with a more tense scenario than expected for soy exports, but it is positive news that Brazil's soybean crushing sector will meet market demand.

Abiove said exports of Brazilian soybeans, soymeal, and soyoil would reach US$51.4 billion this year, lower than the projected US$56.3 billion announced in January.

The group expects record soymeal exports at 18.3 million tonnes for this season. Soyoil exports are expected to hit 1.7 millions tonnes, close to the record high 1.756 million tonnes shipped 10 years ago.

Based on Abiove's figures, Brazil's carryover stocks at the end of 2022 would fall to an projected 1.9 million tonnes, the lowest level in more than 10 years.

-      Reuters