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February 8, 2013

Conab Increases Brazilian Soybean and Corn Estimates

In their latest assessment of the Brazilian soybean crop released on Thursday, Conab increased their 2012/13 production estimate to 83.4 million tons, which is an increase of nearly 26% compared to the drought plagued crop of 2011/12.

The soybean acreage in Brazil is now estimated at 27.6 million hectares, which is an increase of 10.4% compared to 2011/12. The region with the greatest percentage increase was northeastern Brazil and the states of Maranhao, Tocantins, Piaui, and Bahia where the soybean acreage increased 16%. The increases acreage came from the clearing of cerrado land for new soybean production. The nationwide average yield was estimated at 3,018 kg/ha (43.7 bu/ac) compared to last year's yield of 2,661 kg/ha (38.6 bu/ac).

In their written commentary, Conab stated that the lack of rainfall in southern Brazil at the end of December and early January did impact the yield potential of the soybeans in the region, but that the increased acreage in northeastern Brazil more than compensated for the lower yield potential in southern Brazil.

Conab also increased their estimate of the Brazilian corn crop to 76.0 million tons, which represents an increase of 4% compared to 2011/12. The full-season corn acreage declined 5.4% as farmers opted for additional soybean production. The biggest increase came from the safrinha corn acreage, which increased 8.5% led by the state of Mato Grosso where it is expected to increase 20% to 3.1 million hectares. In Mato Grosso, 60% of the soybeans that were planted in 2012/13 are early maturing varieties that normally are harvested during January and early February allowing enough time to plant a second crop of corn or cotton.

Conab is now estimating that 54% of the Brazilian corn crop will be safrinha production. They estimated that the nationwide safrinha corn yield will be 4,949 kg/ha (76.2 bu/ac), which would be only slightly less than the 5,133 kg/ha (79.0 bu/ac) achieved last growing season. Mato Grosso is the largest safrinha corn producing state and they estimate the statewide yield at 5,077 kg/ha (78 bu/ac), which would be down from the 5,680 kg/ha (87 bu/ac) they estimated for last year's crop.

Wet weather continues to delay the soybean harvest in Mato Grosso and therefore the safrinha corn planting is being delayed as well. The official planting window for safrinha corn in Mato Grosso closes about February 20, but if the weather stays wet, they will plant corn past that date. The later the corn is planted, the greater the risk that the dry season will set in before the corn has finished filling grain. safrinha corn production in Brazil is a highly risky crop and the eventual yields will depend on when the crop is planted and when the rainy season ends.