In W25 in the soybean landscape, the USDA, in its June forecast, expects global soybean production in the 2023/24 season to reach 410.7 million mt, slightly higher than the May forecast. This increase is primarily due to larger initial stocks in the US and Brazil, although Argentina's stocks have decreased. The adjustments in inventory levels reflect the production changes in Brazil during the 2022/2023 season, with an increase of 1 million mt to reach 156 million mt, while Argentina experienced a decrease of 2 million mt, resulting in 25 million mt. The global soybean closing stocks for 2023/2024 was adjusted upwards by 0.8 million mt to reach 123.3 million mt. This increase is driven by higher stocks in the US, Brazil, and the EU, but partially offset by lower stocks in Argentina and Vietnam.
According to SECEX, soybean exports from Brazil until W3 of June reached a daily average of 795.3 thousand mt, up 67.2% compared to the average for the entire June-2022. This pace could potentially lead to a new monthly record for Brazil. The strong demand and record harvest in Brazil contributed to this surge in soybean exports. In the first 11 working days of June-2023, Brazilian soybean shipments had already reached 8.75 million mt, 87.6% of the 9.99 million mt achieved in the entire June-2022. If the current daily average is maintained until the end of June-2023, a total shipment volume of more than 16 million mt could be reached, up by almost 8 million mt, surpassing the historical record set in Apr-2021. If confirmed, June's total soybean exports would still be close to the highest levels recorded earlier in Mar-2023 and May-2023, marking the fourth consecutive month of exports above 14 million mt.
CONAB, in its June projection, estimates Brazilian soybean production in the 2022/23 season to reach 155.73 million mt, an increase of 0.92 million mt compared to the May estimate and 24% higher compared to 2021/22. The soybean acreage in Brazil is expected to total 44.03 million ha, an increase of 200 thousand ha compared to May-2023 and up 6.1% compared to 2022/23. The Brazilian soybean yield is estimated at 3,537 kg/ha. During May-2023, the Effective Operating Cost (EOC) of soybeans in Mato Grosso in Brazil for the 2023/2024 crop decreased by 0.92% MoM, with a forecast of USD 1186.21/ha in mt. The reduction is primarily attributed to a 1.92% decline in the cost of fertilizers and correctives. However, despite the decreasing expenses, the average negotiated price for the future soybean crop in Mato Grosso has significantly decreased in recent months. The prices observed in May no longer cover the Total Effective Cost (TOC), and the indicator stands at USD 1.52/sc from the COE, raising concerns as input purchases are delayed and the planting season is set to start in less than three months. This situation could potentially impact investment in the technological package for the 2023/2024 harvest, leading to a reduction in fertilization practices.
Lastly, Togo aims at increasing its soybean production to 500 thousand mt/year by 2028, as outlined in a recently approved five-year strategic plan. Togo aims to strengthen its position as the leading exporter of organic soybeans to Europe by boosting production and focusing on key areas such as domestic processing, organic soybean exports, and human resource development. The plan emphasizes the importance of achieving the soybean production target to ensure sufficient stocks for domestic processing while exporting the remainder. By emphasizing domestic processing and value addition, Togo aims to capitalize on its competitive advantage in organic soybean production, leading to increased revenues for farmers and stakeholders and enhanced competitiveness in the global markets. Togo's soybean industry involves approximately 30 thousand farmers, 200 sellers and exporters, and around 100 companies, with efforts being made to promote domestic processing through the establishment of processing centers at the Adetikopé Industrial Platform.
