Latin America Soybean Cycle 2026: Brazil, Argentina, Paraguay, Uruguay

Brazil 2025 to 2026: Record on the back of Mato Grosso #

Brazil enters the 2025 to 2026 cycle with planted area near 47.8 million hectares, up roughly 1.6 percent year over year, according to CONAB tracking through April. Mato Grosso alone accounts for about 13.2 million hectares, with average yields recovering to 60 bags per hectare after a soft 2023 to 2024 result. Parana and Rio Grande do Sul together contribute another 13 million hectares, with Rio Grande do Sul finally avoiding the La Nina rainfall deficits that depressed three of the previous five harvests. Total production estimates cluster between 175 and 178 million tonnes, which would set a fresh record and add roughly 12 million tonnes versus the 2024 to 2025 cycle.

Logistics remain the binding constraint rather than agronomy. The northern arc through Miritituba, Barcarena, and Itaqui is moving close to 55 percent of export volumes, while Santos and Paranagua absorb the southern flow. Freight rates from Sorriso to Miritituba averaged 320 reais per tonne in March, about 8 percent below 2025 levels, helped by lower diesel and improved BR-163 conditions. The interior crush complex, anchored by ADM, Bunge, Cargill, Amaggi, and a growing roster of Chinese owned plants, is locking in soybean meal and oil margins that justify aggressive forward booking through the third quarter.

Argentina: From drought scar to genuine recovery #

Argentina is closing the 2025 to 2026 harvest with production estimates from the Bolsa de Cereales near 52 million tonnes, a meaningful step up from the 49 million tonne cycle a year earlier and a full recovery from the 21 million tonne disaster of 2023. Planted area held at 17.3 million hectares, with first crop soy concentrated in the core Pampas of Buenos Aires, Cordoba, and Santa Fe, and second crop soy following winter wheat in the same belt. February rainfall in the core zone exceeded the ten year average by 18 percent, supporting pod fill during the critical R3 to R5 window.

Macro conditions remain the swing factor. The Milei administration has maintained a unified exchange rate regime since late 2025, and the export tax on soybeans currently sits at 26 percent for beans and 24.5 percent for meal and oil. Producer selling has accelerated as domestic peso liquidity tightened in the first quarter, and the crush complex along the Up River corridor from Rosario to San Lorenzo is running at roughly 78 percent of the 70 million tonne nominal capacity. Soybean meal exports to Southeast Asia, North Africa, and the European Union are pacing 12 percent above 2025.

Paraguay and Uruguay: The disciplined cluster #

Paraguay is harvesting an estimated 10.8 million tonnes from 3.7 million hectares, with the Alto Parana, Itapua, and Canindeyu departments delivering yields close to 3.0 tonnes per hectare. The country exports the bulk of its output as raw beans through the Hidrovia barge system, with destinations split between Argentine crush plants, the European Union, and a growing direct flow to China. The 2025 phytosanitary protocol update with Chinese customs has reduced inspection delays at Shanghai and Qingdao, and Paraguayan beans are now competitive with Brazilian origin on a delivered basis through August.

Uruguay is on pace for 3.6 million tonnes, a multi year high, helped by favorable rainfall in Soriano, Rio Negro, and Paysandu. Although Uruguay represents under 2 percent of global trade, its role as a counter cyclical supplier and as a transparent, dollar denominated origination point gives it disproportionate weight in tender strategies for sovereign buyers in Egypt, Algeria, and Bangladesh. The Montevideo and Nueva Palmira terminals are operating at capacity through July.

Chinese demand and the United States substitution problem #

Chinese soybean imports are forecast at 108 million tonnes for the 2025 to 2026 marketing year, roughly flat versus 2024 to 2025 but with a decisive shift in origin mix. South American share of Chinese imports is projected at 78 percent, the highest on record, while United States share has compressed to 19 percent from a 2017 peak above 35 percent. The structural drivers include the residual tariff architecture from the second Trump administration trade actions, Beijing's diversification mandate following the 2018 to 2020 disruption, and the maturation of state owned crusher relationships with Brazilian and Argentine suppliers.

United States farmers responded by trimming planted area to 82.5 million acres in 2026, down from 87 million in 2024, and reallocating to corn and cotton where margins are more defensible. The biofuel demand pull from renewable diesel feedstock is real but capped by the 2025 Renewable Volume Obligation revisions and by tallow and used cooking oil substitution. Crush margins at Decatur and Cedar Rapids are healthy at roughly 1.85 dollars per bushel, but board crush is increasingly disconnected from export economics.

Crush margins, ENSO state, and 2026 weather outlook #

Crush margins across the four South American origins have widened materially since the fourth quarter of 2025. The Rosario gross processing margin averaged 78 dollars per tonne in March, up from 54 dollars a year earlier, supported by firm meal demand from the European Union and Vietnam and by oil pricing tailwinds from Indonesian biodiesel mandates. Brazilian interior crush margins in Rondonopolis and Lucas do Rio Verde are running between 65 and 90 dollars per tonne depending on freight basis. Paraguayan crush, still a smaller share of throughput, is benefiting from the same meal pull.

ENSO conditions transitioned to neutral in February 2026 after a weak La Nina in late 2025, and NOAA Climate Prediction Center models assign a 62 percent probability of continued neutrality through the September to November 2026 window, with a secondary 24 percent probability of weak El Nino emergence by the fourth quarter. NASA POWER soil moisture maps confirm above normal profiles across central and southern Brazil and the Argentine core zone heading into the southern hemisphere planting window in September. The base case is a constructive 2026 to 2027 planting environment, although Rio Grande do Sul remains exposed to any late season Pacific shift.

Three scenarios for 2026 to 2027 #

Ceres frames the next marketing year through three scenarios that bracket the plausible range for prices, trade flows, and crush economics. Each scenario is defined by the interaction of weather, Chinese policy, and United States biofuel demand, and each carries distinct implications for procurement timing and hedging structure.

The base case assumes ENSO neutrality, Chinese imports near 110 million tonnes, and stable United States biofuel policy. Under this path, CBOT November 2026 settles in a 10.20 to 11.40 dollar per bushel range, South American FOB premiums remain compressed, and crush margins normalize toward 60 dollars per tonne. The bull case requires either a weak El Nino disrupting Argentine pod fill or a Chinese stockpiling cycle tied to strategic reserve rebuilds, pushing prices toward 13 dollars and widening basis to 120 cents over board. The bear case combines a record 250 million tonne South American crop, softer Chinese crush on hog cycle weakness, and aggressive United States acreage rebound, compressing prices toward 9 dollars and squeezing crush margins below 40 dollars.

Ceres positioning and client implications #

Ceres advises clients across the soybean value chain to treat the 2026 to 2027 cycle as a transition year in which South American supply dominance becomes a structural feature rather than a cyclical anomaly. For commodity trading houses, the priority is to lock in barge and rail capacity in the Hidrovia and northern arc systems before the September pre planting tightening. For crushers in the European Union, North Africa, and Southeast Asia, forward meal coverage through the first quarter of 2027 at current levels is defensible against the bull scenario.

For sovereign buyers and food security agencies, Ceres recommends a layered procurement strategy that blends Brazilian, Argentine, and Paraguayan origin to manage phytosanitary, currency, and weather risk. For asset owners, the structural shift in origin mix supports infrastructure exposure to Brazilian northern arc terminals, Argentine Up River crush, and Paraguayan Hidrovia logistics. Ceres maintains live coverage of CONAB, Bolsa de Cereales, USDA PSD, NOAA ENSO, and NASA POWER datasets and publishes weekly basis and freight tracking for subscribers.

Sources #

• USDA PSD soybeans
• CONAB Brazil crop estimates
• Bolsa de Cereales Argentina
• NOAA ENSO forecasts
• NASA POWER weather