Brazil underlined its claim as the world's biggest soybean
producer, with officials upgrading their forecast to a record 90.3m tonnes, and
the farm minister saying that a far higher result could "easily" be achieved.
Conab, the official crop bureau, raised by 300,000 tonnes to
90.3m tonnes its forecast for Brazil's newly-started 2013-14 soybean harvest.
Production at that level would see Brazil overtake the US as
the biggest producer.
The US Department of Agriculture currently pegs the latest
domestic harvest at 88.7m tonnes, although investors believe this figure will
be raised to 89.2m tonnes (3.28bn bushels) in Friday's Wasde crop report.
And Antonio Andrade, the Brazilian agriculture minister,
said that the South American country - which harvested 81.5m tonnes of soybeans
last year according to Conab - could take the crown of top producer even more
The harvest could "easily" top 95m tonnes, he told
Brazil's harvest is increasingly under the microscope, given
its huge potential, and the prospect – logistics allowing – for the country to dominate
export markets for now, prompting cancellations even of orders of US supplies
"The market now appears to be looking forward to the movement
of new-crop South American, particularly Brazilian, supplies beginning this
month and is also concerned with the possibility of cancellations of soybeans
on the US books to China," Anne Frick at broker Jefferies Bache said.
The USDA is expected in Friday's Wasde to lift its forecast
for Brazil's soybean crop by 1.1m tonnes to 89.1m tonnes.
Corn vs soybeans
Conab attributed its upgrade to a slightly higher estimate
for sowings, seen at 29.6m hectares, up 100,000 hectares on the previous
estimate, and by 1.8m hectares year on year.
Farmers have been "encouraged by the fact that the crop in
recent seasons has presented remunerative prices at the time of marketing",
switching to the oilseed from the likes of corn.
Nonetheless, the corn harvest estimate was nudged higher
too, by nearly 190,000 tonnes to 78.97m tonnes, reflecting a slightly smaller
drop in area than the agency had expected.
The corn forecast remains well above estimates from other
observers, with the USDA pegging the crop at 70.0m tonnes, and expected to
downgrade it further in the Wasde.
However, the Conab figure factors in 46.2m tonnes of second
crop, or safrinha, corn, the same as last year, but a result generally deemed highly
unlikely to be repeated given lower prices will discourage plantings.