Brazil farmers plant more soybean incentivized by high domestic prices

BRAZIL – Brazil is expected to produce a record amount of soybeans as more farmers are incentiviced to grow the crop due to its attractive domestic price, according to the Foreign Agricultural Service of the US Department of Agriculture (USDA). 

Area under soybean farming is estimated to grow to 40.5 million hectares for 2021/22, up from 39 million hectares in 2020/21. 

As more acreage comes under the crop, USDA estimates production at 145 million tonnes, based on a yield of 3.58 MT per hectare.   

This represents a six percent production increase compared to 137 MMT in 2020/21, as well as an on-trend increase in yield, up from 3.47 MT per hectare. 

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Soybean exports in the 2021/22 (February 2022 to January 2023) market year are forecast at 92 MMT, exceeding the estimate for the previous season of 85.3 MMT.  

The forecast is based on expectations of ample available supplies and an extremely favorable exchange rate. 

In 2021/22, China is expected to remain the top importer of Brazilian soybeans with USDA projecting China’s soybean demand to remain strong as the country looks to rebuild its swine herd that was decimated in 2019 by the severe African Swine Fever (ASF) outbreak. 

Given the record domestic production, USDA has revised Brazil’s soy imports to import 400,000 MT, down 250,000 MT. 

The US agency said it based its revision on ample supplies at the start of next season due to record production. 

Soybean to remain Brazil’s principal crop 

Throughout the last decade, Brazilian growers have demonstrated that there is space to plant more soybeans each season—whether from degraded pasture or at the expense of land from other crops.  

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As a relatively easy to grow and profitable liquid commodity, they are considered a reliable choice for growers. 

“Given that the global demand for soybeans is expected to keep rising, Brazilian farmers will continue to expand their soybean production, with assurance that buyers will be ready when the harvest hits the market,” the USDA said. 

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