The U.S. Department of Agriculture, in a recent report, increased Brazil’s forecasted 2019/2020 soybean production and the country is expected to overtake the U.S. as the leading soybean producer. The revision was based on the market exuberance over soybean prices in the past few months.
The USDA foresees a 2019/2020 soybean planted area of 36.8 million hectares and a record harvest of 123.5 million tons – Brazil’s previous record crop was 122 million tons in 2017/2018 season. The U.S. soybean harvest will be less than 100 million tons in 2019/2020, a drop of almost 20% from the previous season. Thus, as long as local weather across the key producing states does not deteriorate significantly, Brazil is expected to overtake the United States as the leading soybean producer in the world this coming season.
Soybean sales from Brazil were driven to a large degree by extremely favorable local soybean price dynamics, specially by U.S.-China trade tensions that prevented Chinese buyers from sourcing beans in the United States. The report anticipates that Brazil will lose some portion of its China export share to the United States in the wake of the trade deal between Washington and Beijing.
Download USDA’s report here.
