Market News & Headlines >> Argentina, Brazil Soy Prospects Night and Day

Soybean crop estimates for Argentina and Brazil continue to head in opposite directions, with an ongoing drought across much of Argentina’s crop belt causing analysts to lower yield expectations there, while Brazilian yield estimates continue to rise on favorable crop conditions. 

Most analysts and producers in Argentina have cut their estimate of the country’s 2017/18 soybean crop to less than 50 million metric tons, according to a Reuters News Service report. "At the start of the season we expected a soy harvest of 57 million tonnes. Now we are looking at 47 million tonnes," Pablo Adreani, head of Argentine farm consultancy Agripac, told Reuters. 

In addition to yield losses, Adreani estimated that dry conditions stopped farmers from planting 800,000 hectares (1.977 million acres) of soybeans that they intended to plant at the start of the season. USDA earlier this month pegged Argentina’s crop at 54 million tons, down from a previous estimate of 56 million and is virtually certain to lower that number further. 

Meanwhile, Brazilian consulting firm Safras & Mercado on Tuesday raised its forecast for Brazil’s crop to a record high 115.6 million metric tons, 1.2% above last year’s record crop and up 1.7 million tons from the firm’s December forecast. Somewhat lower yields in the top two producing states of Mato Grosso and Paraná, which have seen heavy rains in recent weeks, are expected to be more than offset by yield gains in a number of other producing states. 

Earlier this month, another Brazilian consultant, AgRural, pegged Brazil’s crop at 116.2 million tons, which appears to be the highest estimate circulating in the market at this point. USDA currently pegs Brazilian production at 112 million tons, slightly above the most recent official estimate of 111.6 million from Brazil’s agriculture ministry.