Too much rainfall in major production areas in Brazil, including Mato Grosso, the country’s main producer of soybeans, and the states of Goiás, Minas Gerais and Sao Paulo, is continuing to delay planting for some Brazilian farmers this season.
But the delays are minor, and beneficial weather this winter will likely mean a large soybean crop in South America again this year.
“El Niño typically brings good weather to South America, so the chance of a major weather problem this year is fairly low,” said Bruce Weber, soybean product line manager for CHS in Inver Grove Heights, Minnesota.
Weber notes that estimates for Brazil’s soybean crop—the second largest in the world— are currently running between 97 million metric tons and 103 million metric tons due to increased acreage.
Brazil's Celeres recently upped its estimate for the country’s 2015-16 soybean planted area to 81.06 million acres. Celeres also expects the national average soybean yield to drop about 1% to 44.7 bu. per acre due to delayed planting. The forecast would put current-season production at 98.9 million metric tons, up 2% from 2014-15 output, which is lower than what USDA expects.
In its November World Agricultural Supply and Demand Estimates (WASDE), USDA estimates soybean production in Brazil at 100 million metric tons. That’s unchanged from the agency’s October estimate, but 3.8% larger than last year’s 96.2 million metric tons.
For Argentina, USDA’s November WASDE report projects production of 57 million metric tons. That, too, is unchanged from its previous estimate, but is 3.8 million metric tons, or 2.25% smaller than last year. Combined production of the two crops, projected at 157 million metric tons, is unchanged from last year.
Meanwhile, soybean planting in Argentina has been progressing well, and Weber noted that the two countries should be done with soybean planting in the coming weeks.
And if farmers aren’t done planting, well, it won’t be a big deal.
“Brazil and Argentina don’t have to worry about frost,” Weber said. “They have a larger planting window than producers in the United States.”
That’s good and bad, of course. Barring weather issues, Weber said even just an average crop in South America will allow the global soybean supply to continue building to a level that feels burdensome.
While South America has been investing in its infrastructure to move agricultural exports out of its ports to foreign shores, back-ups are still likely as the region’s exports continue to grow.
“People are prepared,” Weber said. “Vessel freights are available, and rates are quite cheap. Vessels will be willing to wait in line for grain.”