Paraguay Eyes Record Soy Crop

Soybean planting in Paraguay begins at the end of this month, and farmers there are hoping to recoup losses from last season's drought-ravaged crop by producing a record 7 MMT of soybeans in 2010.

“2009 was a lost year for agriculture but we are beginning a new season at the end of the month and results for 2010 could be very promising. Apparently we are going to have abundant rainfall because of El NiƱo, and international prices are not optimal but there are not bad either”, said Agronomist Hector Cristaldo, president of the Production Unions UGP told

For this coming season “we expect the area to be planted with soybean to remain unchanged or slightly increased, that is from 2.5 million hectares to possible 2.7 million, which means that with an average yield of 2.600 kilos per hectare, we can again be well above the six million tons threshold, maybe even a record seven million tons, following the four million of this last season," he said.

Paraguay's record soybean harvest to date was the 6.9 MMT produced in 2007/08, according to the USDA. On Friday they forecast production in South America's third largest producer at 5.75 MMT for 2010.

Don't you just know that the poor little Paraguayans will be crying in their Pilsen beer next harvest when they discover that their bigger neighbours in Argentina and Brazil have both had the same bright idea simultaneously.

With record production in the US being followed by potential records in all three major producing nations in South America, demand from China needs to remain strong, as that is the only thing propping this entire market up.