Brazil's 2004/05 (October-September) soyabean crop will expand but at a slower pace than the previous season's break-neck growth - provided prices don't recover sharply, a leading soyabean analyst said on Wednesday.
"It's inevitable that Brazil's soyabean area grow this season," Flavio Franca Jr., chief analyst at Safras e Mercado, told Reuters. "But it's unlikely we will see the same growth in planting that we saw last season."
Franca said Brazil's soyabean crop expanded by 15 percent in the previous 2003/04 season to 21.2 million hectares (52 million acres), but crop output was kept nearly stable with 2002/03 after the plants were hurt by a severe drought in the south and Asian rust in the centre-west.
Soyabean area is expected to grow more modestly this season by 8 percent to 23 million hectares, according to Franca's preliminary forecast.
"It's still not totally defined, however," said Franca. "Futures prices have improved this month. If this continues we could see more aggressive planting growth. The producer still has time to change his planting plans."
Planting for the new crop begins in earnest in October and runs through December, and corn and cotton crops will be competing with soyabeans for field space.
In Safras' preliminary forecast, the new crop output is seen at nearly 66.6 million tonnes, well up from the 49.9 million tonnes from the March-May harvest, due in part to the heavy losses from drought and disease last season.
Franca said Safras' revised forecast would be ready in late October.
The US Department of Agriculture also put the new crop at 66 million tonnes. The Brazilian Vegetable Oils Industry Association (Above) forecast the new crop at 61.5 million tonnes on Tuesday.
"If I were a betting man, I would not say that we will see the same degree of growth in area that we say last season," said Franca. "Average gross profit margins for soya producers have fallen to about 40 percent from 60 percent in previous years."
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