Jan 11, 2019

Conab Lowers Brazil's Soybean Production 1.2 mt to 118.8 Million

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

In their latest assessment of the 2018/19 Brazilian soybean crop, Conab lowered their estimate 1.2 million tons from the previous month to 118.8 million tons. That would now put the crop smaller than last year's record crop when 119.4 million tons were produced.

The 2018/19 soybean acreage in Brazil is estimated at 35.76 million hectares (88.3 million acres) or 1.7% more than last year. This is down only slightly from last month. The nationwide soybean yield is estimated at 3,322 kg/ha (49.1 bu/ac), which is down from last month's yield estimate of 3,354 kg/ha (49.6 bu/ac). That would put the soybean yield down 2.1% from last year or 1.1 bu/ac.

The lower yields are the result of hot and dry weather during December primarily in southern Brazil. Many areas in southern Brazil went 30 days or more without rain when the early maturing soybeans were filling pods. The temperatures were hotter than normal during December and the solar radiation was intense. Rainfall has since returned to these dryer areas in southern Brazil, but they have come too late for the early maturing soybeans. The rains could help the later maturing soybeans.

The dryer weather has now moved further north into central and northeastern Brazil. As a result, virtually all the major soybean producing states in Brazil are now expecting soybean yields in 2018/19 to be lower than in 2017/18. The yield losses are expected to range from down 4-5% to down 30% or more depending on location.

Brazil's total corn production was increased slightly from last month by 0.09 million tons to 91.19 million tons. The increase came from a slightly larger estimate for the full-season corn now estimated at 27.45 million tons. The full-season corn acreage is now estimated at 5,104 million hectares (12.6 million acres) and the full-season corn yield is estimated at 5,379 kg/ha (82.8 bu/ac), which is up 2% from last year.

All the estimates for the 2018/19 safrinha corn production were left unchanged from last month. Conab is estimating that Brazilian farmers will produce 63.73 million tons of safrinha corn, which would be up 18% from last year's poor crop. Conab continues to carry forward last year's safrinha corn acreage (11.54 million hectares or 28.5 million acres), but that will change in their February report when they will release their first estimate of the 2018/19 safrinha corn acreage.

Conab is already factoring in a larger safrinha corn yield compared to last year. Their 2018/19 safrinha corn yield is estimated at 5,518 kg/ha (84.9 bu/ac), which would be 16.9% higher than last year when the safrinha corn yield ended up at a disappointing 4,721 kg/ha (72.7 bu/ac).

Currently, Conab is estimating that the full-season corn production will represent 30% of Brazil's total corn crop while the safrinha production will represent 70% of Brazil's total corn production.