Brazil ups 2023-24 crop forecast to 295.4mn t

Brazil's national supply company Conab increased its outlook for the 2023-24 grain and oilseed crops for the first time since the initial outlook in November, amid upward revisions in expected area for the season.

Conab now expects 2023-24 output at 295.4mn metric tonnes (t), up from 294.1mn t a month ago. That is 7.6pc — or 24.4mn t — lower than the previous cycle's record of 319.8mn t because of the negative effects of the El Nino weather phenomenon over main producing states.

The cycle is projected to yield 3,734 kg/hectare (ha), 8.3pc below the 4,072 kg/ha in 2022-23. That also compares with the 3,744 kg/ha forecast a month ago.

Estimated sowed area expanded 590,100ha to 79.1mn ha this month, which is 578,000ha down from the prior season's acreage.

Soybean output rises

Brazil's 2023-24 soybean crop is now set to reach 147.7mn t, up by 1.2mn t from the 146.5mn t a month ago.

That is a 4.5pc drop from the 2022-23 crop's record of 154.6mn t, but is still the second largest crop in the country's history.

The monthly output increase follows a higher sowed area projection of 45.7mn ha, compared with 45.2mn ha in April. That is also a 3.8pc rise on the year.

The expansion more than offset the downward revision in the outlook of Rio Grande do Sul state, which was recently hit by an unprecedented flood. But Conab said that further cuts may come in the following months, when farmers begin to count losses.

Conab predicts average yields to total 3,229 kg/ha, down from 3,239 kg/ha estimated a month prior and 3,507 kg/ha in the prior cycle.

Corn crop also up

Conab expects Brazil to produce over 111.6mn t of corn in 2023-24, including the country's first, second and third crops.

That is above the previous estimate of nearly 111mn t, but down by 15.4pc — or 20.3mn t — from 2022-23 record volumes.

The forecast for the grain's planted area is at 20.6mn ha, approximately 236,100ha above the prior month's estimate. This represents a 7.4pc drop from the 22.3mn ha sowed in the prior cycle. Projected yields are at 5,414 kg/ha, down from March's estimate of 5,444 kg/ha and 8.6pc below the previous crop.

Winter corn — also known as the second corn crop —accounted for most of the increase. The production forecast rose to 86.2mn t from 85.6mn t, below the 2022-23 crop's 102.4mn t record.

Expected yields fell to 5,388 kg/ha from 5,427 kg/ha a month ago. That is also 9.5pc below the prior cycle's yields. Meanwhile, expected acreage was revised up from the prior month by 214,000ha to almost 16mn ha. The 2022-23 second corn crop was sowed in 17.2mn ha.

The summer corn cycle — also known as the first crop — is set to reach 23.4mn t, up by 133,800t from a month prior. The estimate for acreage rose by around 22,100ha to approximately 4mn ha, while yields remain projected at 5,879 kg/ha.

Brazil's 2022-23 first corn crop produced 27.4mn t, yielding 6,160 kg/ha in a sowed area of over 4.4mn ha.

Wheat down, cotton lint up

Conab now expects Brazil's 2024 wheat production to total 9.1mn t, down by 647,300t from a month earlier.

The decrease follows a 223,000ha drop in the sowed area projection to 3.1mn ha. That is 11pc below the prior season. Estimated yields remained roughly stable in May at 2,942 kg/ha, up by 26pc from a year earlier.

Brazil's 2023 wheat output totaled approximately 8.1mn t, with heavy rainfall volumes in the south dropping yields to 2,331 kg/ha and acreage reaching almost 3.5mn ha.

The forecast for 2023-24 cotton lint production rose by 43,500t to 3.6mn t, which is 470,200t — or 14.8pc — above the prior season's output. That reflects favorable weather in Mato Grosso do Sul and Minas Gerais states.

The yearly increase is driven by a higher expected acreage of 1.9mn ha, almost 17pc above the 2022-23 season and roughly stable from a month ago. Yields rose to 1,876 kg/ha from 1,860 kg/ha in April, which is 1.6pc below the prior season.

Soybean exports slightly up

Conab expects 2023-24 soybean exports to total 92.5mn t, up by 200,000ha from last month's projection driven by a higher expected production this month.

That compares with almost 101.9mn t of soybeans exported in the 2022-23 season.

Corn exports remains set to reach 31mn t, flat from April but a drop from the 54.6mn t shipped in the prior cycle.

By Nathalia Giannetti