Soybean record crop in Brazil presumably smaller than expected

In Germany, UFOP reports that Brazil and Argentina are set to maintain their shares in the global soybean market this crop year. The soybean harvests both in Argentina and in Brazil are expected to be larger, although poor growing conditions dampen prospects of a bumper crop.

Brazil, the US and Argentina are the main soybean producing countries, collectively accounting for 80 per cent of global soybean output. India follows a long way behind with a share of 12 per cent. According to a USDA report, Brazil is projected to harvest a record soybean crop of 139 million tonnes in the current crop year, which would be up around 1 million tonnes from the previous year. Locally extreme growing conditions with dryness on the one hand and excessive rain on the other hand dampen prospects of a bumper crop which the USDA December outlook put at 144 million tonnes. Brazil is consolidating its number one position ahead of the US based on a 1.5 million hectare expansion in area planted. In the US, the soybean harvest was already complete at the end of the year 2021. The harvest amounted to around 120.7 million tonnes. This translates to a rise of around 6 million tonnes year-on-year.

In Argentina, the world’s third largest producer, the harvest is expected to rise slightly to 46.5 million tonnes (from 46.2 million tonnes the previous year), following two years of decline. According to the latest USDA estimate, India also anticipates an increase in harvest of around 1.5 million tonnes year-on-year to 11.9 million tonnes.

The Union zur Förderung von Oel- und Proteinpflanzen (UFOP) has pointed out that, according to Agrarmarkt Informations-Gesellschaft (AMI), the increase in soy output in Brazil is based on a 1.5 million hectare expansion in production area. The association has said that such expansion should be viewed critically because it exacerbates the increasing debate about the transparency needed for deforestation-free procurement. Also, production of biofuel obtained from soybean oil will be affected by the future regulation that soybean oil-based biofuel, along with palm oil-based biofuel, can no longer be counted towards national quota obligations. The UFOP has noted that the French and Dutch governments have already excluded soybean oil from being counted towards quota obligations without any regulation having to be implemented by the EU.