New Delhi — Brazilian soybean planting has been progressing at the slowest pace in the last 10 years because of extremely dry weather across most of the country and recent rains did little to improve soil moisture, agricultural consultancy AgRural said Oct. 19.
Brazilian soybean farmers have managed to plant only 7.9% of the total estimated area until Oct. 15, against 3.4% a week earlier, according to the report from AgRural.
Soybean planting delays in Brazil are not expected to affect total crop output for the 2020-21 crop year (September-August) as the late-planted soybean crop would receive more rainfall in late October and November, which would boost production.
Even in 2019, Brazilian soybean planting was delayed by two weeks and the country still managed to produce 126 million mt, an all-time high.
However, a delayed Brazilian soybean planting means the timing of the harvest could be pushed back a few weeks, which would be advantageous to US soybean farmers, market sources said.
Brazilian soybean harvest generally begins in February, but a delayed planting could push the harvest date a little further.
By the end of January every year, US soybean farmers sell the majority of their stocks, so a lagging Brazilian harvest means tight supply and high demand for US beans in the first quarter of 2021, an ideal scenario for a rise in prices.
If the Brazilian soybean harvest continues to be sluggish, soybean futures could march toward $11/bu in coming weeks, because strong Chinese bean demand is set to continue, market sources said.
According to AgRural, the next week's soybean planting report should show significant improvement on recent rains, but the overall sowing pace is still expected to lag compared with past years.
Rains have been helpful in the week ending Oct. 17 for soybean planting, but the overall soil moisture is well below the required level for beans planting.
Soybean planting requires abundant rainfall and high soil moisture content, while dry weather slows the seedling process.
In Brazil, soybean planting starts in mid-September. But due to extremely dry weather in September, most farmers are waiting for sufficient rainfall during late October to begin sowing.
According to the general consensus among the agricultural analysts, Brazil is forecast to produce over 133 million mt of soybeans in 2020-21, an all-time high for the world's largest soybean producer and exporter.