Brazilian farmers are expected to harvest the second largest amount of soybeans in the history of the country this season. Reuters expects that. The weather conditions are favourable, so that the crops have grown well. The acreage also sets a record. This allows the market to draw on sky-high stocks.
The soybean harvest in Brazil for the 2017/2018 season has just started. The total harvest is expected to be more than 110 million tons, Reuters writes. If this is indeed the case, the country will achieve the second best result in history.
Early record
The old record is young and dates from the previous season. At that time, 114 million tons of soy were harvested, compared to an estimated 110,19 million tons today. The previous Reuters poll was 660.000 tons lower.
The total sown area reached a record this season and amounts to 34,9 million hectares. This is based on estimates and historical data. All forecasts are positive about the harvest in Brazil. The country is the largest exporter of the oilseed in the world.
Later harvest
The sowing work started in September, but due to drought, sowing could only really start in October. As a result, the harvest will probably be slightly slower than normal. According to analysts, the crops are currently in good condition on average. The rain has brought relief after a long period of drought. This has not caused permanent loss of yield. Another 100 millimeters are planned until the third week of January, which can further increase yields.
less corn
Many farmers sow grain maize immediately after soy. This area is expected to be lower than last season. The prices dampen the enthusiasm for this product. It is estimated that the total area will decrease by 11%, to 4,88 million hectares. This means a production decrease of 17% to 25,27 million tons.
A smaller area has the advantage that prices end up slightly higher. Expected to average between 31 and 32,9 real per bale, equivalent to $9,58. Last season the average corn price was 30 real per bag.
Futures market holds steady
Despite the news, the price of soybeans on the CBoT in Chicago has managed to slightly increase its position. The price closed on Friday, January 5, at $353,29 per tonne, an increase of $2,39 per tonne. Corn prices remain stable at around $138 per tonne. A favorable dollar exchange rate ensures that the United States has more export opportunities. Nevertheless, weekly exports were at a low level in the first week of 2018. The holiday season mainly has to do with this.