What if Brazil stops growing its acreage? – Agweek

U.S. weather may be dominating the headlines as we move through August, but South American weather is beginning to enter traders’ minds. Brazil is still several weeks away from beginning soybean planting, yet early acreage expectations and the developing weather pattern already deserve attention. For more than two decades, Brazil has helped absorb growing global demand by continually expanding soybean and corn acreage. The market has become accustomed to assuming another increase in planted area, another record crop and another large export program. That assumption may be tested in 2026-27.

Early conversations within Brazil suggest soybean acreage could be closer to unchanged this fall. That is far from an official forecast, and plenty can change before planting begins. However, even the possibility of flat acreage represents an important shift for the world balance sheet.

Brazil’s rapid production growth has come from two sources: improving yields and expanding acreage. Yields have generally followed a steady, linear trend higher, much like they have in the United States. Acreage has grown much faster, often increasing by several million acres per year. That expansion has allowed Brazil to overcome less-than-perfect weather. A yield problem on a larger acreage base can still result in a bigger crop. A yield problem on flat acreage becomes an actual production loss. That distinction matters because the world is already counting on Brazil to produce another record soybean crop.

USDA currently projects Brazil will produce 186 million metric tons of soybeans in 2026-27, up from 180 million metric tons this year. Brazilian exports are expected to reach 118 million metric tons, accounting for roughly 62% of projected world soybean exports. To put Brazil’s growth into perspective, global soybean production is expected to increase from 429.5 million metric tons this year to 441.7
million metric tons next year. Brazil alone is expected to provide 6 million metric tons of that increase.

The United States is also expected to produce a larger crop, but Brazil remains the primary source of exportable soybeans for the world market. China is projected to import 115 million metric tons in 2026-27, while total world soybean trade is expected to reach just over 190 million metric tons. If Brazil merely repeats this year’s 180 million metric tons crop instead of reaching USDA’s 186 million metric tons projection, the world balance sheet would lose roughly 220 million bushels of soybeans before accounting for any additional weather problem.

That would not create an immediate shortage. USDA currently projects world soybean ending stocks at 124.2 million metric tons. However, the headline carryout does not tell the entire story.

China is expected to hold more than 44 million metric tons of those soybeans. When China is removed, world stocks fall to just under 80 million metric tons. Argentina also holds a large share of exporter stocks, but much of that supply is typically processed domestically rather than exported as whole soybeans. In other words, Brazil’s available export supply matters more than the headline world carryout suggests.

The first weather concern will be the return of seasonal rainfall across central and northern Brazil. Producers normally begin planting soybeans in September as the dry season ends, but widespread progress depends on more consistent rain arriving during October. That makes the developing El Niño pattern a top concern. El Niño years tend to favor wetter conditions across southern Brazil and Argentina while increasing the potential for dryness across central and northern Brazil.

That does not guarantee a poor crop. Seasonal forecasts issued in early August carry plenty of uncertainty. It does, however, give traders something to monitor as planting approaches. Too little rain across Mato Grosso and surrounding areas could delay the start of soybean planting. Meanwhile, excessive rain across southern Brazil could also slow fieldwork. Brazil could conceivably face planting delays for two different reasons in two different regions.

But the soybean crop is only part of the story. Brazil’s soybean planting pace determines when the crop can be harvested and when the second corn crop can be planted. The safrinha crop now accounts for the majority of Brazil’s corn production. Delayed soybean planting compresses the entire crop calendar and pushes more corn acres beyond their preferred planting window.

Brazilian producers generally want soybeans planted by early to mid-November. Soybeans planted later are harvested later, leaving the following corn crop more exposed to the dry season during pollination and grain fill. A two-week planting delay may not significantly reduce soybean yields if weather improves later. However, those same two weeks can materially change the risk surrounding the corn crop.

USDA currently projects Brazil will produce 139 million metric tons of corn in 2026-27 and export 44 million metric tons. That would account for approximately 21% of projected world corn exports. The global corn balance sheet does not have unlimited room for a Brazilian production problem. World ending stocks are projected to decline from 298.7 million metric tons this year to 275.3 million metric tons next year. Once China is removed, projected world stocks fall to approximately 110 million metric tons. At the same time, global import demand remains strong. The United States is projected to export more than 81 million metric tons of corn during 2026-27, but that forecast also assumes Brazil produces and exports another large crop.

A 5 million metric tons change in Brazilian production would equal roughly 184 million bushels of soybeans or 197 million bushels of corn. Those losses would not disappear neatly from world demand. They would likely shift trade toward another supplier, with the United States positioned to capture at least part of that business.

For soybeans, a smaller Brazilian crop could extend the U.S. export window deeper into winter and force China to remain more active in the U.S. market. That would become especially important with U.S. ending stocks currently projected at only 310 million bushels. For corn, delayed Brazilian planting could support U.S. exports next summer, particularly if the safrinha crop enters its dry season with limited moisture. Europe’s declining corn production already has the world looking for additional supplies.

None of this guarantees higher prices. Brazil has not planted the crop, acreage estimates remain preliminary, and the weather forecast will change repeatedly over the next several months. A timely return of rainfall combined with strong yields could still allow Brazil to produce another record crop. However, the market may no longer be able to assume additional acreage will cover every weather problem.

Brazil has spent more than two decades giving the world more acres, more soybeans and more corn. That growth has conditioned traders to believe another record crop is always coming. If acreage expansion pauses in 2026-27, Brazil will need favorable weather simply to deliver the production already built into current balance sheets.

The story is not bullish yet, but it is worth watching. For the first time in several years, the world may be asking Brazilian weather — not additional acreage — to do most of the work.

Allison Thompson is a market analyst with The Money Farm located in Ada, Minnesota. She previously has worked as a Farm Business Management instructor and is active on her family’s Mahnomen, Minnesota, grain farm. She purchased The Money Farm and has turned her experiences in the fields and classroom into a career where she is able to help producers facing the challenges of today’s markets.