Aprosoja Brasil reduces 19/20 harvest to 120 million tons of soybeans

Exports to China continue to rise and bring stability to the soybean chain amid the pandemic

15.04.2020 | 20:59 (UTC -3)
Vinícius Tavares

Brazil is expected to harvest 120 million tons of soybeans in the 2019/2020 harvest. According to information from the April edition of the bulletin Harvest Estimate, released this Tuesday (14/4) by Aprosoja Brasil, the projection is lower than that made in March, when the entity estimated the harvest at 120,6 million/t. The data was obtained from technicians and soybean growers from the 16 producing states.

The area planted with the oilseed will be 37,2 million hectares. Mato Grosso continues to lead national production, with 34.014 mi/t, followed by Paraná (20.721 mi/t). Rio Grande do Sul suffered from severe drought in some regions and had its estimate reduced to 10.456 mi/t, placing fifth.

The general numbers, however, are enough to keep Brazil in the lead in the world production ranking, with 36% of the soybeans produced on the planet. In second place comes the United States, which is expected to harvest 97 million t and accounts for 29% of the world's soybeans, followed by Argentina, which produces 65 million t and covers 16% of production. Together, these three countries account for 81% of world oilseed production.

Brazil also leads in exports, with 77 million tons sold (52% of total exports), followed by the United States, which sold 48 million tons (33% of total exports) and Argentina, which sold 13 thousand tons ( 6% of international trade). The three countries account for 91% of world exports.

World scenario: exports to China on the rise

The country broke a new export record in March: 13,3 million/t compared to 12,3 million/t in May 2018. Brazil has already sold 60% of the 2019/2020 harvest and 10% of the 20/21 harvest and has already sold 35 mi/t this year. China continues to buy Brazilian soybeans due to the high oil and protein content of the national product. Brazil exported 60 million tons to China in 2019 (compared to 66 million tons in 2018) and is expected to export between 60 and 66 million tons in 2020.

Covid-19 is expected to lead to a global recession with an estimated drop in Global GDP of up to -2%. Lower global GDP growth affects markets, exchange rates and consumption growth in rich countries. China imported 82 million tons of soybeans in 2019 and is expected to import 85 million tons in 2020. Everything indicates that the internal problems will be resolved and the country will import 90 million tons again. Having overcome the epidemic and African Swine Fever, which reduced Chinese pig herds, the country continues to import soy and meat on the international market and should resume domestic production of animal protein, increasing soy consumption.

The first phase of the trade agreement brings stability to the market, but does not guarantee purchases of US soybeans by China, which will buy according to price and availability. There is a prospect of purchases starting in the second half of the year with the arrival of the North American harvest on the market.

Brazilian participation in soybean exports

Also produced based on data collected from the Brazilian Association of Vegetable Oil Industries (Abiove) and the Foreign Trade Secretariat of the Ministry of Industry and Commerce (Secex), the bulletin also informs that 50% of Brazilian soybeans are destined for export and 25% of the soybean meal exported in the world was produced in Brazil. The soybeans and bran produced in the country are consumed by 65 countries. Furthermore, the soybean complex accounts for ¼ of the products exported by agribusiness.

LS Tractor February