Brazil poised to overtake U.S. as leading soybean producer

Price movements in late 2019 pushed some producers to sow slightly larger area.

Krissa Welshans, Livestock Editor

January 22, 2020

1 Min Read
Brazil poised to overtake U.S. as leading soybean producer
Corn and Soybean Digest

The U.S. Department of Agriculture’s Foreign Agricultural Service (FAS) recently reported that a successful 2019-20 growing season will place Brazil as the top global soybean producer, with FAS forecasting planted area at 36.8 million hectares for the season. The forecast was raised from the prior update due to market exuberance over soybean prices in the last several months.

According to FAS, the Brazilian real weakened against the dollar from about 4.09 reals to the dollar in October to 4.17 reals for the first two weeks of December. This pushed some producers to sow a slightly larger area than they otherwise would have, FAS explained.

“Notably, the area expansion could have been larger if the local market believed that global soybean consumption would be higher. There is still a lot of consternation over dampened Chinese demand due to the widespread prevalence of African swine fever (ASF), which has decimated swine herds and curbed feed needs. Additionally, producers are keenly following the emerging trade truce between the United States and China.”

FAS projects that Brazil will set another production record in the 2019-20 crop year, at 123.5 million metric tons. Brazil’s previous record soybean crop was 122 mmt in the 2017-18 season.

The 2019-20 production forecast is based on a return to trend-line yields after the current season was adversely affected by inclement weather. FAS said as long as local weather across the key producing states does not deteriorate significantly, Brazil is expected to achieve the top spot.

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About the Author(s)

Krissa Welshans

Livestock Editor

Krissa Welshans grew up on a crop farm and cow-calf operation in Marlette, Michigan. Welshans earned a bachelor’s degree in animal science from Michigan State University and master’s degree in public policy from New England College. She and her husband Brock run a show cattle operation in Henrietta, Texas, where they reside with their son, Wynn.

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