South America, the world’s largest soy-producing region, could lose 20 million tons this crop, in relation to its potential.
It is a very complex account to be done yet, but if this lack of rain and intense heat persists, the losses in Brazil, Argentina, Paraguay, Uruguay and Bolivia could reach that number, according to Daniele Siqueira, an analyst at AgRural.
The USDA (United States Department of Agriculture), always very conservative, has already anticipated part of this fall this Wednesday (12). According to the US agency, the three main producers in the region — Brazil, Argentina and Paraguay — already accumulate at least 9.5 million tons in losses.
The figures obtained by Usda indicate a retraction of 5 million in Brazil, 3 million in Argentina and 1.5 million in Paraguay. Daniele believes, however, that, little by little, Usda should readjust the crop numbers of these countries downwards.
By the current numbers alone, South America would already have a reduced harvest to a volume close to the 200 million tons of last year.
The Brazilian crop, forecast by Usda at 139 million, should decline even further. AgRural estimates a volume of 133 million. The Brazilian potential was 145 million.
For Paraguay, the market forecasts 6 million, below the 8.5 million of the US agency. Argentine production, estimated at 46.5 million this Wednesday by USDA, will be 44 million, according to market estimates.
A change in climate, however, could stem part of this loss. Soybean is more resistant than corn, and the return of the rains would bring an improvement in productivity.
In addition, Mato Grosso and Matopiba (Maranhão, Tocantins, Piauà and Bahia), where the climate is more favorable, may obtain higher-than-expected productivity, according to the AgRural analyst.
Usda released a scenario of global supply and demand on Wednesday. It was a boring report with little new information when it comes to US figures, US analysts said.
US soybean production was 120.7 million tons, and corn production was 383.9 million. Higher production and lower exports help improve the country’s ending inventories.
This year’s soybean numbers leave the market quite volatile, according to Daniele. In both Chicago and Brazil, current soybean prices reflect the effects of the weather.
On the Chicago Commodity Exchange, the March soybean contract hit $13.99 a bushel (27.2 kilograms), up 9.8% from a month ago. In Cascavel (PR), the physical market negotiates the bag at R$ 175, up 7.7%.
Prices no longer rise because world demand has lost steam, compared to last year. China, which came with a big appetite, should maintain the level of imports at 100 million tons. Otherwise, the increases would be even more dramatic, says the analyst at AgRural.
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