Saturday, April 5, 2014

2015 Brazil soybean area

There have been some 2015 Brazil soybean area forecasts in the news this past week.

General consensus is that 29.7-29.8 million ha were planted this past season.

We will also have about 800,000 to 1 million hectares of 2nd crop soybeans
planted for harvest in May and June 2014.

I have talked to several large operators this past week. The business
model is to continue to increase soybean area for 2015.

The idea of another 1 million hectares planted to first crop soybeans
for 2015 is a bit optimistic. Cost of production to grow a crop is still
at record high levels. Only the well capitalized are still expanding.

Parts of MaPiToBa have been whacked with two years of drought.

I think some in those areas will need to lick their wounds for a year or two.

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I am watching fertilizer sales for 2014. This will be the leading indicator
as to how many soybeans get planted at the end of the day.

My personal feeling at this time is more of a stand pat scenario for 2015 and
not one of expansion.

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