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Lower 2020-21 ending stocks forecast seen set to support Brazilian soybean prices, sales volumes

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Lower 2020-21 ending stocks forecast seen set to support Brazilian soybean prices, sales volumes


FAS predicts lower ending stocks in 2020-21

Price to remain elevated on harvest delay, high demand

Brazil's soy exports at all-time high in 2020-21

New Delhi — Brazilian soybean prices and sales are expected to remain elevated in the 2020-21 marketing year (February 2021-January 2022) on the back of a lower ending stock forecast, market sources told S&P Global Platts Jan. 7.

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The country's soybean sector is expected to have extremely low ending stocks in 2020-21 of 0.36% of domestic supply, compared with 0.5% in 2019-20, according to the US Department of Agriculture's Foreign Agricultural Service report released Jan. 6.

On the back of the tight supply scenario, Brazil is very likely to import 800,000 mt of soybeans, down 11% year on year, mostly from Paraguay, in 2020-21, FAS said.


Soybean prices are slated to continue to rise in 2021 on tight supply, coupled with steady demand and a delayed harvest, analysts said.

Echoing the sentiment, FAS said Brazilian prices are likely to remain high in coming weeks on harvest delays.

The soybean harvest will not pick up in earnest until late January, so domestic soybean scarcity will persist for at least another month and a half, FAS said.

In addition, there is a real possibility of yield damage in Brazil due to prevailing dry conditions, stoking supply concerns, the report said.

Domestic beans demand will likely pick up in earnest after the first week of January, when the Brazilian crush industry will start to look to meet the needs of expanding livestock production and soy oil manufacturing, FAS said.


FAS forecast 2020-21 soybean production at 131.5 million mt, down 1.5 million mt from the USDA's December World Agricultural Supply and Demand Estimate, but still the highest-ever volume.

Across the country, planting got off to a slow and uneven start due to a lack of consistent rain that normally arrives in September. Brazilian farmers typically begin planting mid- to late September.

Due to the delayed planting, dry weather and inconsistent rains, some analysts have pegged the Brazilian soy output as low as 129 million mt.

So, a further cut in USDA's 2020-21 forecast for Brazilian soybean is very likely in upcoming WASDE reports, sources said.


Brazil's soybean exports for 2020-21 are forecast at 85 million mt, an all-time high, on expectations of available supplies and an extremely favorable exchange rate, FAS said.

In the key soybean importing countries of China and in Europe, meat consumption is not likely to suffer a dramatic downturn despite the economic slowdown due to the pandemic, it added.

The market expectation is that the Brazilian real will continue to trade at just above Real 5 to the US dollar in 2021, FAS said.

A weak Brazilian real is expected to boost farmers' sales in 2021 as it makes the oilseed extremely competitive in international markets, especially in China and Europe, analysts said.

Soybean farmers have already sold close to 60% of their forecast 2020-21 production, up 20 percentage points year on year, according to state reports.

Brazilian soybean farmers are very likely to sell almost all of their forecast new crop volumes before the harvest hits the market in late January or early February, analysts said.

USDA Official

USDA Official





Area Planted (million hectare)




Area Harvested (million hectare)




Production (million mt)




Import (mt)




Exports (million mt)




Crush (million mt)




Ending Stocks (mt)




Source: USDA FAS