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Corn+Soybean Digest

Brazil Agriculture Ministry Lowers Soy Forecast

Brazil’s agriculture ministry now projects that country’s soybean production to fall below last year’s level based on the potential for the La Nina weather phenomenon to cause adverse growing conditions in early 2008.

The National Commodities Supply Corp. (CONAB), the supply arm of the agriculture ministry, on Monday pegged Brazil’s 2007-2008 soybean crop at 58.1 million metric tons, down from a previous estimate of 59.4 million tons and its 2006-2007 crop estimate of 58.4 million tons.

In contrast, the Brazilian government’s statistic agency IBGE on Monday pegged soybean production at 59.35 million tons, up fractionally from a previous estimate of 59.32 million tons and a 2006-2007 crop estimate of 58.2 million tons.

The two agencies said last week they were going to release a joint forecast for the first time, but their figures were significantly different.

"The difference (between CONAB and IBGE) is due to CONAB already comprehending the probable impact of La Nina on the crop. It may reduce rains during January and February. IBGE did not do this," CONAB's logistics director, Silvio Porto, told reporters in a news conference in Brasilia.

CONAB sees soybean production falling despite an estimated increase of 1.3% in Brazilian soybean plantings due to favorable market conditions.

La Nina-related weather problems are expected to be concentrated in Brazil’s southernmost soybean growing state of Rio Grande do Sul.

CONAB sees Rio Grande do Sul’s soy production falling to about 8 million tons vs. more than 9.9 million tons last year when yields there were exceptionally strong due to favorable weather.

CONAB estimated Brazil's total corn crop at 52.3 million tons, compared with a previous forecast of 51.83 million tons and a 2006-2007 crop of 51.37 million tons.

Editor’s note: Richard Brock, The Corn And Soybean Digest's Marketing Editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.

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