MATO GROSSO DO SUL (DTN) -- Mato Grosso do Sul state could see an increase of 23.7 percent in soybean production this season, according to preliminary estimates from the Rally da Safra crop tour.

Local farmer Danilo Queiroz de Souza is very happy with soybean yields this season and hopes to make a profit despite lower prices.

The state, which lies directly south of Mato Grosso, could see production top 5 million metric tons this season, from 4.2 mmt in 2008-09.

The rally, in its seventh year, kicked off in Mato Grosso on Jan. 25 and will cover more than 30,000 miles across 12 states until Mar 22. I joined up with the group this week, and will travel over 1,000 miles through Mato Grosso do Sul and Parana states.

On Monday we set out from Mato Grosso do Sul state capital Campo Grande and stopped at over a dozen farms on the way to Maracaju. The majority of farmers were extremely happy with yields.

I rode the combine with Danilo Queiroz de Souza, who farms over 2,500 acres near Sidrolandia, in the center of Mato Grosso do Sul, and witnessed yields of 65 to 70 bushels an acre.

Souza told me that yields were much higher than last season, when he averaged around 48 bu/acre due to a dry period in December and January.

Souza noted, however, that prices were much better last season, as he managed to get average of $10.50 a bushel for his beans, compared to current prices of around $7.80/bu.

"Higher yields make up for the lower price this season and costs were lower so margins are likely to be better this season," said Souza, who added that he will hold on to his beans until August or September in the hope prices may improve.

Another farmer we talked to was also very happy with yields on early beans, but was concerned that later beans might not be as good.

"There has been a dry spell in recent weeks and temperatures are very high," said the farmer. "Unless we get rain soon later beans could suffer."

Fabio Meneghin, crop analyst with tour organizer Agroconsult, believes Mato Grosso do Sul will see average yields of around 44 bushels an acre this season, slightly lower than neighboring Mato Grosso were yields could average 46 bu/acre.

Brazil is seen producing a record 65 mmt to 66 mmt of soybeans this season. Agroconsult will release official results for the Rally da Safra tour on March 30.

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Photo caption: Local farmer Danilo Queiroz de Souza is very happy with soybean yields this season and hopes to make a profit despite lower prices.

(CZ)

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