Oct 23 / Ignacio Espinola

Brazil Soy and Corn crop update 24/25

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*     The weather forecast for the next weeks is showing some very needed rains that will help the farmers to increase their planting pace and catch up with the harvest.
*     USDA and CONAB numbers are showing a promising crop on corn and a very good ones for soybeans.

Current Scenario

Brazilian planting progress has been delayed over the last weeks due to a dry weather that has complicated the planting season for the summer corn and soybeans crop. The weather forecast for the next weeks is showing some very needed rains that will help the farmers to increase their planning pace and catch up with the harvest. Weather Report

Even though the planting period has been delayed, both, USDA and CONAB numbers are showing a promising crop on corn and a very good ones for soybeans.

Soybeans Update

Last week Conab released it’s 24/25 numbers for Soybeans and it has come up with a 166 M ton production number which is +12.67% more versus the 147.4 M ton 23/24 crop. This 166 M ton would be the highest crop ever for Brazil, leaving behind the 22/23 154.6 M ton record crop.
This record number is explained by an increase in the planted area of 2.8%, up to 47.33 M hectares and a 9.6% yield increase, from 3.2 Ton per hectare to 3.5 Ton per hectare. We also have to take into consideration than this increase in the area is the lowest one reported in the last six years which could reflect the low expectation when it comes to prices for next year.

Brazilian crop progress this year is only at a 17% planted done while last year we were at 29%. Brazil Crop Progress

The lack of moisture due to the dry weather has created a delay on the soybeans planting period and also to the corn one. Next day’s rains bring more moisture into a very dry soil which will be a good opportunity to catch up with the planting pace.

Regarding prices, it does seem than this update from Conab has not affected the futures market considering than the USDA number is very similar, with only +3 M mt more, at 169 M ton for Brazil production. Moreover, during October, there has only been 2 days than the board has closed in green numbers, which clearly is showing a bearish trend price wise. Finally, and comparing the funds situation with the recent months, it does seem like the market is going back to the 5Y-average range which usually translates into a close to zero or even long position for the beans market at this time of the year.


Funds Position Soybeans
Brazil WASDE + Conab 24/25 Soybean numbers

Fonte: Conab e USDA - Hedgepoint


Corn Update

 Conab’s update brought a production number for Brazil of 119.7 M ton, 4 M ton more versus previous year but still far away from 22/23 record crop at 131.9 M ton. Comparing this number with the WASDE one, it does seem like the Conab is being conservative with it’s bets, as the WASDE is showing 127 M ton, 8M ton more than Conab.

The main driver for the Conab increase comes from the yield, that got adjusted from 5.49 ton per hectare to 5.7 ton per hectare and the area planted got a small increase, from 20 M hectares into 21 M hectares.

We also have to take into consideration that Brazilian corn crop has three different stages. The second stage, called Safrinha, represents about 80% of the whole country’s production. Conab is expecting a Safrina at 94,6 M ton which is 4,4 M ton more versus previous crop. This crop gets planted after the soybean crop which means that the expectations will depend a lot on what finally happens on the soybean side.

Last crop report numbers are showing a 53% summer corn planted, which is 10% behind last year numbers. Even though the pace has not been great this year compared to the previous one due to the lack of moisture, current and next week rains, especially on the center of Brazil, will bring hope for the farmers to catch up and be able to plant in due time.

Also, it is too early now to be able to say if there will be any yield and quality issue or not. There has been year where delayed planting has been very beneficial for the crop, like what happened during the past season, where the crops planted in center-north region of the country benefited.
Funds Position Corn

Source: USDA - Hedgepoint

Brazil WASDE + Conab 24/25 Corn numbers

Source: WASDE - CONAB - Hedgepoint


Written by Ignacio Espinola
ignacio.espinola@hedgepointglobal.com
Reviewed by Thais Italiani
Thais.Italiani@hedgepointglobal.com
www.hedgepointglobal.com

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