May 10, 2011

Brazilian Farmers Aggressively Forward Selling 2011/12 Soy Crop

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

With still four months to go before farmers in Mato Grosso are allowed to start planting their 2011/12 soybean crop, producers in the state are aggressively forward selling their anticipated soybean production to take advantage of good prices and to lock in their input costs. According to the Mato Grosso Institute of Agricultural Economics (Imea), farmers in the state have already negotiated 14% of their 2011/12 production and this does not include negotiations with grain companies to exchange inputs for future soybean production. During the last growing season, this level of forward sales was not achieved until July, two months before planting.

Farmers in Mato Grosso have also been aggressive in purchasing their inputs as well. Imea estimates that farmers in the state have already purchased 66% of their seed needs, 68% of their fertilizers, and 52% of their chemicals.

Farmers have also been selling their 2010/11 production at an accelerated pace as well. Imea estimates they have already sold 81% of their 2010/11 soybean production compared to 73% and 70% at this time for the 2009/10 and 2008/09 growing seasons respectively.