Market News & Headlines >> USDA Seen Slashing S. American Soy Crop Estimates Further

USDA is expected to slash its estimate of Brazil’s 2021/22 soybean crop while cutting  production further for Argentina and Paraguay as well when it releases its monthly Supply/Demand update on Wednesday morning. In addition, expectations are that USDA will cut projected corn production further for both Argentina and Brazil.

The crop downgrades are expected due to extended drought in southern Brazil and much of the country’s center-south growing region along as well as in Paraguay that has taken a toll on crop yields there. Meanwhile a period of extremely hot, dry weather in Argentina from mid-December to mid-January did permanent damage to crops there.

Pre-report trade expectations of Brazil’s soybean crop average 133.65 million metric tons in a range from 126.50-137.50 million tons compared with USDA’s January estimate of 139.0 million tons, according to a Reuters News Service survey of 16 analysts. Several crop estimates that came out of Brazil last week skewed even lower, running between 125.0 and 130.0 million tons. Pre-report estimates of Argentina’s crop average 44.51 million tons in a range from 43.00-46.00 million versus USDA’s January estimate of 46.50 million tons.

Trade expectations for Argentina’s soybean production average 44.51 million tons in a range from 44.51-46.00 million compared with USDA’s January estimate of 46.50 million tons. However, the Buenos Aires Grain Exchange has already cut its crop estimate to 42.00 million tons and the Rosario Grain Exchange in Argentina’s main export hub has cut its estimate to only 40.00 million tons.

Trade estimates of Argentina’s 2021/22 corn crop average 52.16 million tons in a range from 51.00-53.50 million tons compared with USDA’s January estimate of 54.00 million. The U.S. agricultural attaché in Buenos Aires recently forecast the crop at 51.00 million tons, while the Rosario Grain Exchange lowered its forecast of Argentina crop to only 48.00 million tons back in January. The Buenos Aires Exchange has not updated its crop estimate from a pre-season estimate offered last fall.  

Trade estimates of Brazil’s total 2021/22 corn production average 113.63 million tons in a range from 111.00-115.00 million tons compared with USDA’s January forecast of 115.00 million tons. USDA is seen lowering production due to the impact of drought on first-crop corn yields. However, second-crop corn planting, which is now underway, is off to a faster-than-normal start, which is favorable for production potential.