Brazil and Argentina may plant record amounts of soybeans next season as improving profit prospects spur farmers to switch fields to the oilseed and away from grains, Oil World said.
Brazil, the world’s largest soybean grower and exporter after the U.S., may plant 26.4 million hectares (65.2 million acres) of the oilseed in the 2012-13 season, or 5.4 percent more than a year earlier, the Hamburg-based researcher said today in an e-mailed report. The country may cut its corn planting to 14.5 million hectares, 4.1 percent less than a year earlier.
In Argentina, the world’s third-largest soybean grower and exporter, farmers may plant 19.6 million hectares, up 5.8 percent from a year earlier. The country may produce a record 54.5 million to 55.5 million metric tons of soybeans. Wheat planting may plunge by 22 percent to 3.6 million hectares, while the corn area rises by 2.8 percent to 5.1 million hectares.
“Farmers in South America are getting more enthusiastic about expanding soybean cultivation, taking advantage of the comparatively lower production costs, in relation to grains, and favorable price prospects,” Oil World said. “Many of them have already started marketing their 2013 crops,” even though harvesting won’t begin for another seven to nine months, it said.
Soybean prices have climbed 10 percent this year on the Chicago Board of Trade, while corn tumbled 20 percent and wheat was little changed. The oilseed rallied as dry weather in the past season hurt South American crops, while Chinese demand increased for U.S. supplies.
Frost and Snow
Almost 1 million hectares of Argentina’s 2011-12 soybean crop still need to be harvested, while some regions of the country have experienced frost and snow, Oil World said. The country’s output in the season may drop to 40 million tons, down from 49.2 million a year earlier.
Brazil’s 2011-12 soybean production was estimated at 65.8 million tons. Corn output at 67 million to 68 million tons will surpass the soybean harvest “for the first time in recent history,” Oil World said.
Argentina is the world’s second-largest corn exporter, after the U.S., and Brazil ranks fourth, after Ukraine. Argentina is the biggest wheat shipper in South America.