Brazil has, once again, raised the bar for estimates of its soybean crop, saying it will now beat last's year harvest by more than 10m tonnes.

Conab, Brazil's crop supply agency, raised its estimate for 2009-10 production by 840,000 tonnes to 67.57m tonnes.

The revision, from an organisation noted for conservative estimates, reflected positive results from the harvest, which is about one-third complete, as well as benign weather.

"Good yields and regular rains in the major productive areas were responsible for the better evaluation of this month", Conab, which is short for Companhia Nacional de Abastecimento, said.

The agency also added 20,000 tonnes to its forecast for Brazil's corn output, taking it to 51.38m tonnes.

Production vs profits 

The soybean revision follows something of a fall-off over the last month in the pace of upgrades to Brazil soybean production estimates, as rains in some parts, notably the north western state of Mato Grosso, reached levels which looked likely to damage crops.

However, higher production is not necessarily being translated into better profits for farmers, who are receiving lower prices for soybeans, in part because of the strength of the Brazilian real, but seeing many costs rise.

Many farmers in Matto Grosso have made three or four fungicide applications this season, compared with one or two in a typical year, to control disease encouraged by heavy rains.

'Half on transport'

Meanwhile, higher transport costs and toll charges have increased the cost of transport soybeans from the state to ports by about 25%.

"When you combine all the costs associated with transporting soybeans out of Mato Grosso to export facilities, it accounts for nearly 50% the total cost of producing soybeans," consultancy Soybean & Corn Advisor said.

"For every 10 bushels of soybeans produced, five bushels goes to just covering transportation costs."

The US Department of Agriculture, which currently forecasts Brazilian soybean output at 66.0m tonnes, will on Wednesday reveal fresh estimates for global crop supply and demand.