Brazil's national crop agency (Conab) forecast the soybean harvest at a record 107.6mn tons this year, a nearly 2pc increase on the previous 105.6mn t estimate published in February, and a 12.8pc jump on the 2015-16 crop.
The expected increase in supply of the main raw material for biodiesel production in Brazil was attributed to an almost 2pc rise in planted area and ideal rains since the start of the planting season in late 2016, Conab said.
Brazil is forecast to export nearly 59.1mn t of soybeans from the current crop, which will restore its place as the leading exporter of the commodity after drought slowed last year´s exports to 51.6mn t, Conab data shows.
Brazil is the world's second largest soybean producer after the US. China is the principal importer of Brazilian soybeans and is forecast to import a total of 86mn t from all sources this season, up 3.3pc from the previous season, Conab said. The depreciation of the Brazilian currency (real) relative to the US dollar provides an added boost.
Brazil is expected to export 1.55mn t of soybean oil during the 2016-17 season, up from 1.44mn t last season. The country´s grain crushing industry is forecast to process 40.5mn t of the current soybean crop into oil and meal.
Early onset and follow-up rains over the planting period that started in September 2016 allowed soy farmers to plant and harvest early across the main soybean growing states, led by Mato Grosso, which is reflected in the pace of exports early this year.
The trade ministry recently reported that Brazil exported 3.51mn t of soybeans in February, up 72pc from the same month a year ago. In the first two months of 2017, Brazil exported 4.42mn t of soybeans, up 82pc from 2.43mn t in the same period a year ago.
Brazil's unrefined soybean oil exports also rose 30pc to 146,868 t in the January-February period from a year earlier.
Mato Grosso's Institute of Agricultural Economics (Imea) said in this week's soy crop report that harvest in the state surpassed 78pc of the planted area, a 12.5 percentage point advance on last year at this time, although harvesting was slowed in recent days by heavy rains.
Rains have also caused some isolated damage to mature, but yet unharvested, soybeans in the state, Imea said. And export cargoes moving out of the state on trucks headed for the northern Amazon ports in the neighboring state of Para have been stranded by the rains. The heavy precipitation turned segments of BR-163, the main highway for moving soybeans through the region, into impassible stretches of mud. The government had to helicopter in food and water to the truckers stranded on the road.
Imea said soybean prices have been falling in recent weeks as silos in the region fill and movement of the commodity out of the state slows because of rain. This is expected to help crushing margins for the state´s vegetable oil processors.
Soybean oil accounts for nearly 70pc of Brazil's biodiesel production, with beef tallow, used cooking oil and pork and poultry fat accounting for the rest.
