As the soybean harvest gets under way in Brazil, analysts are having a clearer picture of whether the forecast record-setting crop will hit the century mark of 100 million tons despite hot and dry weather in Mato Grosso and northeastern Brazil as pods set and fill.
Growers planted nearly 4% more land to soybeans than last season. With slightly above-average yields, that would bring a crop that easily exceeds the 96.2 million tons of 2014/2015, says USDA.
March is the main month for harvesting. Soybeans are booming in Brazil, with this year’s crop expected to be 15% larger than two years ago.
Second to the U.S. as a soybean grower, Brazil is on track to thrash America as the top exporter. Usually, it’s a fairly close race between the nations.
However the strong dollar is constraining U.S. exports at the same time Brazil’s real currency is weaker with the result that U.S. soy exports are forecast to shrink while Brazil’s soar by nearly 13%.
In the end, Brazil could ship as much as 11 million more tons of the oilseed than U.S. exporters. “China will remain the main destination for Brazilian soybeans,” says the U.S. agriculture attaché in Brasilia.
Brazil’s soybean industry formally requested that the Foreign Ministry consider a WTO challenge of U.S. farm supports, specifically U.S. weather insurance and price guarantees, wrote the attaché early this year.
The industry is squeezed by high production costs and low world soybean prices, exacerbated by economic unrest at home. Brazil won a WTO challenge of U.S. cotton subsidies as trade distorting, which forced Congress to rewrite the cotton program in the 2014 farm law.