Brazil’s soybean output cut to 153m mt, massive loss in Mato Grosso: Itaú BBA

Brazil’s largest agricultural-producing state, Mato Grosso, is set to have its largest soybean crop loss in history, reducing the country’s overall 2023/24 output to 153 million mt, according to estimates released Wednesday by Itaú BBA consulting.

“We cut Mato Grosso’s yields, leading to a 20% crop loss compared with initial estimates as we expect the state to harvest less than 40 million mt of soybeans,” the Itaú BBA said.

“If our estimates prove to be correct, this will be the largest soybean crop loss in Mato Grosso’s history,” the consulting firm added.

Weather models had called for improved rainfall volumes across Brazil’s center-west and north/northeast regions, including Mato Grosso, from the beginning of December, but the first half of the month remained drier than average, jeopardizing crops in drought-affected areas.

Considering the new 153 million mt output figure for the country, which is 5 million mt lower than the consultancy’s estimates from two weeks ago, and a 3% increase in domestic consumption, Itaú BBA pegged Brazil’s 2023/24 soybean exports between 95 and 96 million mt.

The consulting firm sees Argentina’s 2023/24 soybean production at 50 million mt, leading to a global balance sheet “slightly tighter than initially expected, although close to 2022/23 levels.”

It caveated, however, that global grains and oilseeds demand is expected to grow around 5% on the year, which will impact soybean prices during the season.