Dry conditions in southern Brazil and in La Pampa in Argentina in January and February have caused a drop in yields, and the excessive rains since have cause difficult harvests. If waterlogged conditions continue some farmers may abandon harvesting altogether. Brazil’s soybean production is now estimated at 88 million tons – down 3% from January’s prediction and Argentina is expected to harvest 53.5 million tons – down 2% from previous estimates. Farmers in both countries are holding back their soybeans from market. In Brazil, in the hopes that the price will continue to rise and in Argentina the fall of the peso and a 35% export tax on soybeans and soybean products is causing farmers to hoard their crops. Even in the face of these conditions, global soybean production is expected to hit a record of 284 million tons – up 5% year on year with ending stocks up 4% year on year at 27 million tons keeping soybean oil prices 25% below their peak of 2011 and 2012.
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