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More Beans for Brazil?

South American Crop Watch

U.S. ag economist expects lower fertilizer prices for Brazilian farmers.

Published on: April 20, 2011

My 30th high school class reunion takes place in June, but I just don't know if I'll be able to make it to Mount Olive, Ill., to see those old classmates. It would be great to find out what ever happened to my old pal Mike, atop whose Kawasaki 900 we spent Senior Skip-Out Day back in 1981. Or the girls who only seemed to go out with the guys who had cars.

I suppose I'm thinking about it because I'm traveling through Brazil right now with another old friend—the kind of guy you wanted to sit behind in math class.  Ag economist David Asbridge and I just took a trip to Londrina, Paraná, where he gave a presentation to about 30 farmers at Expo Londrina 2011—a big farm show in Brazil's second-largest soybean-producing state.

I translated the talk in which Asbridge said the trend seemed to point to a long trend toward more growth in soybean production here in Brazil while U.S. production stayed relatively flat.

He said the signs all point to continued demand increases for beans from places like China, on the market for protein to feed the hogs and ducks and cattle to feed 1.3 billion people. But, as the USDA's latest Planting Intentions Report shows, U.S. producers appear to favor increasing their corn production over soy. And someone is going to need to fill that world demand.

The Brazilians seemed to like that conclusion. But one guy in the audience seemed to think Asbridge was talking about U.S. farmers giving up on beans.

He wasn't. "I'm not saying Brazil will replace the U.S. as a major soybean producer," he told the questioner. "I'm saying that foreign buyers are buying now - and will continue to buy - more soybeans on world markets. And an increasing amount of the growth in demand will be met by Brazil."

And that wasn't the only thing they heard at the presentation that met with their approval. Asbridge, whose site covers world fertilizer markets and issues, told the group that fertilizer prices would likely come down a bit this year, as prices for the upcoming crop may actually be lower than for this past year. 

"Due to Increasing capacity in the industry," he said, "fertilizer supplies should be more plentiful, allowing for rebuilding of inventories and less pressure on fertilizer prices.  In fact, we are expecting fertilizer prices to average about ten to 15% lower over the next year, once we get through the rush of the North American spring season." 

And that's music to the ears of farmers in a country with great rainfall but soil that is acid, powdery and tired.

So, if Asbridge is right, I may be able to get that Kaw or Harley with the money saved in time for the class reunion. Maybe then those girls would give me the time of day.

 

 

 

That's me on the left, conferring with David Asbridge and Paraná farmer Edison Ponti just before Asbridge's presentation.