April 11, 2012

Brazil's 2011/12 soy crop forecast down three million tonnes

Brazil's 2011/12 soy crop estimate on Tuesday (Apr 10) was sliced more than three million tonnes due to drought and will trim exports of the key source of protein and livestock feed.

Soy output from the No. two producer after the US will fall to 65.6 million tonnes this season, which is weeks away from finishing harvest. A sharp drop from the 68.7 million forecast in March and the record 75.3 million tonnes harvested a year ago, the agriculture ministry's crop supply agency Conab said.

The monthly estimate was the agency's lowest of the previous six so far this season and came in below most other market views.

On Tuesday, the USDA also lowered its estimate of the Brazilian crop, to 66 million tonnes from the 68.5 million tonnes it projected in March.

Soy exports from Brazil were expected to fall to 31.2 million tonnes from 32.4 million tonnes shipped in 2010/11, Conab said. Drought has plagued southern soy producing regions in Brazil as well as Argentina and Paraguay, which all together account for more than half the world's soy trade.

Chicago soy futures have risen more than 31% since mid-December when it became clear that drought was going to hurt the South American crop.

Despite the roughly 10-million-tonne drop in soy output from last year, local producers were pushing their second, or winter, corn crop plantings into record territory.

Brazil's total corn production from the 2011/12 crop was forecast at a record 65.1 million tonnes, Conab said, up from 61.7 million tonnes forecast in March and up sharply from the 57.4 million tonnes harvested in 2010/11. Corn exports were expected to reach 10 million tonnes this year, up from 9.5 million last season, Conab projected.

Brazil became the world's third largest exporter of corn in the past few years.