Brazilian Grain Production Forecast to Rise

Brazil is expected to break its grain production record in the 2018/19 season that began in September. In its first forecast for the coming season, Conab, the government’s food supply and national statistics agency, estimates a harvest of as much as 238.5 million tonnes, a gain of 4.7 percent from the previous year. The greatest increase will be for Brazilian corn, which is expected to see production rise 12.75 percent to 91.08 million tonnes. Soybean output is expected to total 119.42 million tonnes, roughly in line with this year’s record output. Production of other crops, including cotton, peanuts, and sunflowers, is also estimated to increase in the coming year.

Conab’s positive outlook comes amid strong global demand, especially for Brazil’s soybeans, as a result of the US-China trade war. Higher levels of farm credit in Brazil, strong fertilizer sales, and an increase in area planted indicate that Brazilian farmers are keen to take advantage of higher soybean prices. Gro Intelligence subscribers can monitor production quantities and area planted to keep up to date with Brazil’s grain industry.

The CONAB forecast follows a report from the USDA that estimated Brazil's 2018/19 output of corn and soybeans will total 94.5 million tonnes, up 15.24 percent, and 120.50 metric tonnes, up 0.58 percent, respectively.

An estimated increase (left chart) in production of Brazilian soybeans and corn comes amid strong global demand, especially from China. Area planted in Brazil to corn and soybeans (right chart) has been rising steadily, largely accounting for the increased harvest sizes.