South America is preparing to expand soybean acreage, further reducing prices
Argentina could see the largest expansion of soybean acreage in a decade. Plantings in Brazil are also expected to increase, Agriculture reports.
The U.S. soybean harvest is wrapping up with record crop numbers. Argentina expects a significant expansion in soybean acreage, the largest in a decade, while Brazil’s growth will be more modest at 2.8% to 117 million acres, the slowest pace in a decade. Still, with favorable weather conditions, Brazil’s soybean crop could reach a record 166 million tons, up 13% from last year when drought cut production in the central-western states. Increased soybean supply in both countries is expected to depress global prices for the product.
USDA’s forecast for Brazilian soybean exports in the 2024/2025 season has been revised upward to 102 million tons, up from the previous season’s estimate. The revision is based on increased supply expectations and a highly favorable exchange rate. Market expectations also indicate that the Brazilian real will continue to trade at around R$5.5 per USD$1 in 2025.
A weaker real makes agricultural commodities from Brazil highly competitive in international markets and leaves Brazil as the world’s number one bean exporter.
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