South American Soybean Comments

The USDA increased both the Argentine and Brazilian soybean crop estimates by one million tonnes this month. We have found that the Brazilian estimate has increased from the March forecast into the austral fall in most years in which the March soybean estimate was increased. But the same trend does not apply to the Argentine soybean estimates. 

South American soybean crop estimates don’t change much after July. The Argentine March estimate and the July estimate has a correlation of 87% while the same correlation for Brazil is only 67%. We do our studies on a first difference basis to eliminate the influence of trend. The statistics suggest that the Brazil soybean crop is probably larger than this month’s forecast, but do not lead to any strong conclusions for the Argentine soybean crop.