October 8, 2008
Brazil's 2008-09 soy crop estimates reduced
Planted areas for Brazil's new 2008-09 soy crop won't be as big as initially thought as soy prices collapsed amid growing fears of a global economic slowdown, said local agribusiness consultancy Celeres.
Soy growers will likely increase the area to 21.9 million hectares, 2.1-percent less than Celeres' last crop estimate.
Yield estimates are 2,812 kg of soy per hectare, just 0.3-percent greater than the recent 2007-08 crop. Celeres also lowered its yield estimate by 1.4 percent.
Total output is put at 61.6 million tonnes, or 3-percent more than last year.
March soy on the CBOT plunged by 6.8 percent on Monday to close at US$9.515 per bushel compared to nearly US$14 a bushel a few short months ago.
The local currency has compensated for much of the losses, currently trading at BRL 2.21 to the US dollar. The Brazilian real hasn't been at those levels since 2005.
In addition, Brazil's agriculture minister said that the country's agricultural sector needs at least BRL 10 billion (US$4.3 billion) to avoid a decrease in the size of its 2008-09 crops, reported news agency Estado on late Tuesday.
"If we don't get the BRL 10 billion, a large part of the producers will continue to plant, but they are going to use less fertilisers," Estado quoted Minister Reinhold Stephanes as saying.
This could lead to a 20-percent drop in crop production in cases where farmers don't use fertiliser, he said.
The minister said that around BRL 5 billion (US$2.16 billion) will be needed to help farmers, while another BLR 5 billion is needed to support exporters.
Brazil is the world's second largest soy exporter.
