Will Brazil's 2023 Soybean Production Record Impact Global Market?

The Latin American country of Brazil is well-known for its massive soybean production, in 2023  the nation has outdone itself yet again. Total soybean production in Brazil is estimated to have increased rapidly, breaking the record of the previous several years and reaching an upper level of 15.25 million tons. In this article, we will explore more about soybean production highlights and the impact of increased production on the world.

Highlights Of Brazil’s Soybean Production 2023

• Soybean Meal Availability In Brazil– Looking ahead to the 2022-23 season in Brazil, it is projected that the total availability of soybean meal will reach 428.69 lakh tons. This calculation takes into account the previous stock of 18.54 lakh tons, a projected production of 410 lakh tons, and estimated imports of 15,000 tons. Of the total availability, 203 lakh tons are expected to be exported, while 203.69 lakh tons will be used domestically. At the end of the marketing season, there will be a remaining stock of 22 lakh tons.
• Soybean DOC Exports And Recovery Rates– Despite the increase in production and crushing processing, the export of soybean DOC (de-oiled cake) may remain relatively unchanged from 2022. The United States Department of Agriculture (USDA) reports that the average recovery rate of soybean DOC in Brazil could improve from 77.29% to 77.36% in 2023.

Impact On Crushing Processing In Europe

The surge in production is expected to have a significant impact on the European region, particularly in the amount of crushing processing of soybean. In 2022, 4.86 million tons of soybean were processed for crushing in Europe, but with the increased production from Brazil, this year’s estimated amount is projected to rise to 5.30 million tons.

It’s important to note that Brazil is the largest producer of soybean in the world, and the increase in production has the potential to impact not just Europe, but other countries that rely on Brazil for their soybean supply as well. While the impact on exports of soybean DOC may remain relatively unchanged, the rise in production and crushing processing in Europe may lead to a reduction in prices for soybean products overall.

OFB’s Insight

Brazil’s record-breaking soybean production is a significant development for the global agriculture industry, particularly in the European region. With the potential for lower prices and increased supply, it’s clear that this year’s soybean harvest will have far-reaching implications for years to come.

Read more: Can Delayed Soy Exports And Soy Dollar Scheme Help Argentina Navigate Drought Crisis

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