Brazil Cuts Soybean, Corn Forecast on Fertilizer Cost (Update1)
By Carlos Caminada
Nov. 6 (Bloomberg) -- Soybean output in Brazil, the world's second-biggest producer, will unexpectedly fall next year as farmers lack credit to buy more expensive fertilizer, the government said.
Soybean output will decline to between 58.4 million and 59.3 million metric tons, compared with 60 million tons this year, the Agriculture Ministry's crop-forecasting agency said today in an e-mailed report. The agency, known as Conab, last month forecast production to rise to between 60.1 million and 61.3 million tons.
The global credit crunch came as farmers in Brazil sought financing to finish buying fertilizers for planting this month. The lack of credit means some regions will cut planting, and the reduced use of fertilizers may trim yields, Conab said.
``Production costs are significantly higher during the planting season and there are difficulties to access credit,'' Conab said in the report.
Average soybean yields will drop 1.6 percent to 2.77 tons per hectare in next year's harvest, Conab said. A hectare is equal to 2.47 acres.
In the Center West, which accounts for half of Brazil's soybean output, farmers will reduce planting as much as 2.9 percent to 9.35 million hectares.
Corn production will fall to 54.3 million to 55.2 million tons, from 58.6 million tons, Conab said. That compares with the October estimate for a drop to 55 million to 56 million tons.
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