Brazil’s soybean production continues to be scaled down with the latest harvest estimate at 152.4 million metric tons (MMT) – down 1.4 MMT compared to the previous estimate, according to the Brazilian Association of Vegetable Oil Industries. 

Even with the reduction, mostly a result of floods in Rio Grande do Sul, Brazil soybean exports are expected to remain at 97.8 MMT. Estimates also haven’t changed for soy crushing or oilseed oil, at 41.7 MMT and 11 MMT, respectively.

Challenges for Brazil’s second corn crop

Drought is impacting the second corn crop where harvest is only 28% complete, according to the Brazilian Agriculture Society. 

In Mato Grosso do Sul production has dropped by 19% to 11.4 MMT. Yields dropped 14% to 59 bushels per acre. 

The southern state of Parana has seen production drop to 13.2 MMT – down from the previous estimate of 13.23 MMT and last year’s crop at 14.2 MMT. In Parana, the yields are expected to fall from an average of 56 bushels per acre in the previous season to 46 bushels per acre in 2024.

“Recently lower prices and lack of water are the things that are worrying producers in Mato Grosso do Sul,” says Mateus Fernandes, an analyst at the Association of Soybean Growers of Mato Grosso do Sul.

The forecast does not show relief in drought conditions as precipitation is expected to be below average this week.

Argentina nears finish line for second crop

Corn and soybean production estimates remain unchanged in Argentina, according to the Buenos Aires Cereal Exchange. Soybean output is estimated at 50.5 MMT and harvest is 99.7% complete. Corn production is projected at 46.5 MMT with harvest at 54.9%.

Soybean export sales dropped 45% in June compared to May as producers see a future devaluation of Argentina’s currency, according to the Center of Argentinean Cereal Exporters. The total volume sold in June was 3.8 MMT. The total exported so far in the year is 8.9 MMT.

Argentina has sold 44% of soybeans for the 2023-24 marketing year or 21.6 MMT, which is in line with previous years according to government officials.