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Brazil's soybean 2019-20 output at record 123.9 million mt: AgRural

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Brazil's soybean 2019-20 output at record 123.9 million mt: AgRural

New Delhi — Brazilian soybean production in 2019-20 crop year (September-August) is forecast at 123.9 million mt, up 1.4% from December estimate due to better yield expectation, agricultural consultancy AgRural said Monday.

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The soybean yield was expected to rise 4% year on year to 3.32 mt a hectare on sufficient rainfall across the region in the past few weeks, Brazilian national crop agency Conab said in its latest report.

The country's soybean harvest has reached 0.4% of the projected 2019-20 area as of January 9, Agrural said. The current harvest pace is 1.7 percentage point slower year on year and 0.3 points lower than the five-year average, it added.

AgRural estimates that Brazil will plant soybeans on 36.4 million ha in the 2019-20 crop year, which started from September 1, up 1.6% year on year.

Under normal weather conditions soybean planting across Brazil starts in mid-September but dry weather in September 2019 delayed planting by a couple of weeks. As a result, the harvest pace is lagging behind year on year, Conab said.

The US Department of Agriculture forecasts Brazil -- the world's largest soybean producer and exporter -- will export 76 million mt of beans in the 2019-20 marketing year (October 2019-September 2020), up 1% year on year.

ROAD AHEAD

Brazil is still the primary soybean supplier to China, the world's largest soy consumer, accounting for 80% of its total soybean purchases, December Chinese customs data showed. However, the US-China phase one trade deal, greater domestic crushing demand, and a higher biofuel mandate may limit Brazilian export growth in the coming months, sources said.

According to Conab's December report, 2019-20 (September-August) domestic soybean consumption is forecast at 48.6 million mt, up 8% year on year.

As global demand for meat products rises, primarily fueled by African swine fever-hit Asia, the trend of rising domestic soybean crushing demand is set to continue in Brazil, which needs the soybean-based animal feed to meet demand from its cattle industry, sources said.