Brazil’s 2016 Dry Bean Production to Drop Significantly
September 19, 2016Brazilian trade authorities project a drop in bean production for 2016. This is due to multiple factors including:
Crop diversification
Brazilian farmers usually decide to grow dry beans when they can obtain a premium over the main crop of each season. Despite the bullish trend in the bean market, soybeans proved to be a better and safer option for growers.
Weather Issues
Crops were hit by one of the strongest El Niño events in recent years which brought heavy rains to Brazil’s dry bean heartland in the south and sustained drought in the arid northeast.
Low Carryover
State-owned carryover stocks of carioca beans-which account roughly for 70% of the country’s dry bean consumption, have been dropping steadily since last year.
Conab’s (National Supply Company) latest report revised Brazil’s dry bean production for 2015-16 down by 4% from last month. The output of the third harvest was revised down by 7.5%. Prices will remain high despite the third harvest and the market continues to present opportunities for imports of U.S. dry beans.
Brazil’s Dry Bean Production 2015-16, Source: CONAB