Brazil's soybean 2020 crop is getting larger

PORTO ALEGRE, Brazil -- Brazil’s National Supply Company (Conab) has increased its forecast for 2020 soybean production by one million metric ton compared to a month ago, as harvest nears halfway finished.

The output projection was raised to 124.2 million metric tons. The USDA, Tuesday, estimated Brazil's soybean output at is 126 million metric tons.

The first corn crop output forecast, on the other hand, was lowered by the government agency from 26 million metric tons to 25 million metric tons. Roughly, the second corn crop was unchanged because the crop was planted about a month ago and remains at nearly 73 million metric tons.

READ MORE: USDA data is a nonevent Tuesday

According to private consultancy Safras & Mercado, from Porto Alegre, planting of the second corn crop reached 77% of the surface as of now. To give a rough perspective, last year by the same time, the crop was nearly 91% planted, but 64.5% planted for the last five year.

The strongest impact of the coronavirus for the Brazilian farmer right now is the dollar value, which reached R$ 4.75 on March 9th. In the analysis of the consultancy, the trend with a strong dollar is that sales are boosted now not just because the end of the harvest.

Data from Safras & Mercado also reveals that the sales of the projected production jumped from 49.8% of the soybean crop last month to 61% this week. The average for the period is 45.5%. If the projections are accurate, nearly 74 million metric tons would have been sold as of now. The sales of output regarding the 2020-21 crop jumped from 5.2% in February to 14%.

In the state of Mato Grosso, the harvest is about to end this week and it is faster than expected. In the case of Nova Mutum, in the Central part of the state, the average yields have been higher than expected with 53.5 bushels per acre with 98% of the soybean fields harvested. Previously, this municipality suffered with excessive rain.

“The yields now are good for soybean. For the second corn crop, however, we are having problems with high temperatures and lack of moisture at the reproductive stage of plants. It is still very early to talk about any loss,” said Emerson Zancanaro, president of the Association of Farmers of Nova Mutum.

In the western part of the Northeastern state of Bahia, the news website Noticias Agricolas reported that the yields can reach up to 71.3 bushels per acre harvesting “a full crop”. Producers in the region are getting ready for a record crop.

In other extremes of the country, in the south, the Rural Institute of Technical Assistance of Rio Grande do Sul admitted the soybean crop losses could overcome three million metric tons as harvest gaining track. The southern state is the last one to harvest in the country.

Rio Grande do Sul recently hosted the Expodireto, one of the largest farm shows in the country. In the show, machinery sales were 10% higher reaching nearly $ 555.5 million. The strong sales occurred as Brazil shifts from having subsidized credit rates to farmers to market interest rates. That, however, has been an issue this month because interest rates in the country have lowered to 4.25% per year. According to analysts, for the long-term loans that is nears what farmers were used to borrow to buy combines, a tractor or large sprayer.