Brazil early planting record Soya Bean targets1 Oct 2021 21:57
Farmers in Brazil began planting in September for what is expected to be a recording-breaking 2021-2022 harvest. The first projection from CONAB (National Supply Company in Brazil) projects farmers will produce 289.6 million tons of soybeans, corn, cotton, rice, and beans – accounting for nearly 95% of the total grain produced in Brazil.
About 99 million acres are expected to be devoted to soybeans, and about 51 million acres to corn, both records. The projections are based on high international prices and profits in 2021, depreciation of the Brazilian real relative to the U.S. dollar, an expected increase in exports, and the profitability forecast for 2022.
Brazil is likely to remain the world leader in soybean production in the next crop year, followed by the United States and Argentina. Brazilian soybean acreage is expected to grow 3.6%, to 98.62 million acres, according to CONAB. Most of the acreage increase is expected to be the conversion of pasture to soybean acre. The 2021-2022 soybean crop in Brazil is projected to be 5,190 million bushels, the highest in history, an increase of 3.9% over the previous harvest.
Historically high prices and profits in 2021, coupled with optimistic expectations for the next harvest and the depreciation of the real relative to the dollar, are motivating farmers to increase the acreage they plant. It is important to highlight that the price of soybeans in the Brazilian market is formed by the three following factors: international prices, port premium, and the dollar. All three factors are expected to remain high in 2022 because of the low world stock-to-consumption ratio, and the increase in domestic consumption.
Brazilian soybean exports and the crush are expected to increase in 2022, driving the increase in acreage planted. The demand for more biodiesel fuel and the high consumption of animal feed also are expected to fuel domestic demand in Brazil next year.
The soybean crush is projected at 1,891 million bushels, a 10.7% increase over this year. Chinese demand and a weak real with a strengthening U.S. dollar will drive an increase in soybean exports. Soybean sales are projected to reach 3,218 million bushels next year, 5 percent higher than this year, according to CONAB report.