Brazil's Soybean Harvest Faces El Niño Risk and Global Market Shifts

A strong El Niño developing in 2026 has more than a 90% chance of forming, according to NOAA, OMM, INPE and Embrapa. Experts warn it could bring excessive rain to the South, drought to the North‑East and heat to the Central‑West, reducing Brazil’s soybean productivity by up to 9% and pushing food‑price inflation as high as 15%.

The National Supply Company (Conab) reports that the 2025/26 soybean harvest is now 100% complete, while second‑crop corn is at 6.7% of its area. The harvest pace varies by state, with Mato Grosso leading progress.

Itaú BBA’s simulations show that a modest 6% drop in Brazil’s soybean output would cut global soybean stocks to about 108 million tonnes, the lowest level in three years, and could trigger a price rally despite the typical geographic offset of El Niño effects.

At the same time, the soybean complex is seeing a record rise in the share of oil in its integrated value, especially in Argentina, where oil now accounts for about 55% of total value. Brazil’s expanding crush capacity and biodiesel mandates are eroding Argentina’s historic lead in soybean meal exports, tightening competition in the global market.