Can analysts out-predict USDA, Conab on Brazil crop forecasts?

Market & Price Trends
Published Apr 13, 2024

Tridge summary

Market analysts are closely watching the U.S. Department of Agriculture (USDA) and Brazilian agency Conab for their upcoming updates on Brazil's soybean and corn harvest forecasts, expecting significant reductions. Despite historical discrepancies between the USDA and Conab, particularly with a notable 10% difference in corn production estimates for the 2023-24 season, the trend suggests both agencies might lower their projections for Brazil's soy and corn output. This anticipation is fueled by past underestimations and recent adjustments in historical data that hint at underestimated demand. Meanwhile, projections for Brazil's 2023-24 soy crop have varied widely among analysts, with the USDA's forecast being one of the highest, only surpassed by a Brazilian consultancy's estimate following an extensive crop tour. This variance underscores the keen interest and uncertainty surrounding Brazil's agricultural output in the coming season.
Disclaimer: The above summary was generated by a state-of-the-art LLM model and is intended for informational purposes only. It is recommended that readers refer to the original article for more context.

Original content

Market analysts once again seek a sizable cut to Brazil’s ongoing soybean harvest from the U.S. Department of Agriculture on Thursday despite disappointment over the agency’s relatively modest trims in recent months. However, USDA’s track record in April has been better than the trade’s over the last few years, potentially easing doubts for the agency’s upcoming soy forecast. Brazilian agency Conab will also update its crop estimates on Thursday, and although there are no published trade estimates for these numbers, Conab’s April soy projection is usually closer to the final than USDA’s. But that statement comes with the huge caveat that “final” production is not always the same among the two agencies, especially with the last couple harvests, and this has been a source of confusion among traders. This is particularly prominent in corn as Conab and USDA sit 10% apart on total Brazilian corn output for the current 2023-24 season, and this warrants eyes both on Thursday and in the ...
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