October 14, 2003

Brazil May Rise to Become World's Largest Soybean Exporter in 2003-04

Brazil is expected to surpass the United States as the world's largest soybean exporter in the 2003-04 marketing year, the Agriculture Department said today.

The USDA's October World Agricultural Supply and Demand Estimates report projected that Brazil will export 26 million metric tons of soybeans in 2003-04 and US is projected to export 23.68 million metric tons. The USDA did not announce that Brazil would export more soybeans than the United States in the text of its report but after reporters covering the USDA monthly release of supply and demand statistics noted the projection in the statistical charts. For the first in time, the USDA World Agricultural Outlook Board confirmed that analysts believe Brazil will replace the United States as the No. 1 soybean exporter.

Keith Menzie, a WAOB soybean analyst, told DTN that the projection is based on a smaller U.S. soybean crop this year due to bad weather in soybean growing states. Menzie noted that the projection on exports could change because the Brazilian crop has just been planted, but he said the 3 million metric ton spread is so large that it is unlikely the United States would recover its position.

Brazil is rapidly expanding soybean production. USDA reported that Brazil's soybean crop has grown from 43.5 million metric tons in the 2001-02-crop year to a projected 60 million metric tons in 2003-04. The United States is projected to remain the largest producer of soybeans in 2003-04, with a crop of 67.18 metric tons. American Soybean Association chief executive officer Steve Senski told DTN he was "not entirely surprised" by the report. Senski said the expansion of Brazilian soybean production demonstrates the impact of Brazil's currency devaluations, which have reduced the price of Brazilian soybeans on world markets.

The report also showed that US imports of soybeans and soy meal have increased.

Soybean imports have gone up from 60,000 metric tons in 2001-02 to a projected 200,000 metric tons in 2003-04 while soybean meal imports have risen from 130,000 metric tons in 2001-02 to an estimated 150,000 metric tons. Senski said the tonnage figures on soybeans do not have much meaning because some of those soybeans come from Canada and re- exported from the United States. But Senski said much of the soy meal comes from Brazil and is imported into Wilmington, N.C., for feed in U.S. poultry operations.