Brazil’s forecasted record soybean production could push global soybean supplies to their second-highest level ever in 2022/23, good news for countries facing tight inventories of other agricultural commodities and historically high food prices.
Brazil, the world’s largest soybean exporter, has mostly completed its soybean crop planting. Favorable early weather and expanded acreage point to a 22% increase in production versus last year, according to Brazil’s CONAB.
Such a production jump would have ramifications for oilseed prices worldwide and could influence what US farmers plant for the 2023 season. Brazil and the US compete to satisfy China’s substantial soybean import demand, which has soared tenfold since 2000 to record levels, as shown in this Gro display.
Global soybean supplies outside of China have tightened in recent years. World soybean ending stocks, excluding China, dropped in 2021/22 to a six-year low, following repeat seasons of lackluster US production and last year’s reduced output in Brazil.
Meanwhile, the stocks-to-use ratio, a measure of supply availability, for world soybeans excluding China fell last year to its second-lowest level in six years. This Gro display shows historical and projected soybean ending stocks and stocks-to-use ratios.
Beneficial rainfall has boosted the Brazilian crop, with accumulated precipitation since the start of September up 11% from the 10-year average, as shown in this display from Gro’s Climate Risk Navigator for Agriculture, weighted for Brazil’s soybean growing areas. While southern Brazil states have been relatively dry, forecasts call for light amounts of rain there in the coming week.
Gro users can monitor the Brazil crop’s progress using Gro’s Brazil Soybean Monitor, which includes our yield forecast model, vegetative health index, and supply and demand balance sheet. The machine-learning Gro Brazil Soybean Yield Forecast Model, which updates daily down to the district level, will begin making live forecasts around mid-December when the crop becomes established.
The Brazilian crop’s prospects will depend on growing conditions through harvest time early next year. With the La Niña global weather pattern given a 76% chance of sticking around through at least February, growing conditions could still deteriorate for Brazil’s soybean crop and the subsequent second corn crop, as Gro wrote about here.
La Niña tends to bring increased rain in northern Brazil and dry conditions in the south of the country, where soybean production plunged last year due to La Niña-induced drought, as shown in this display of the Gro Drought Index.
Meanwhile, Brazil’s neighbor Argentina is suffering persistent drought due to La Niña that has cut forecasts for many of the country’s crops, including corn and wheat. Argentina’s soybean crop prospects, which Gro users can track using our Argentina Soybeans Monitor, also are diminished as accumulated precipitation since September is 42% below the 10-year average in the country’s soybean growing areas, as shown in this Gro Navigator display.