FCStone lowered its rating to four million tons compared with the January estimate, saying that after a dry period in early December, rainfall in January was below average on some key areas of soybean production in Central Brazil, which probably affected the yield.

Last year, Brazil produced a record harvest of nearly 120 million tons and exported about 80 million tons of it basically in China amid trade disputes between the Asian country and the United States.

FCStone also cut its forecast for soybean exports from Brazil to 68 million tons, given the fact that the local demand for recycling is likely to increase due to the increase in the government share of biodiesel. The fuel in Brazil must contain 11 percent of the biodiesel compared to 10 percent in 2018.

The Agency, however, increased the estimate of corn production to 92.4 million tons. It is expected that the production of the second corn crop which is planted after the harvest of soybeans will rise sharply from last year.

"Corn exports probably will exceed 30 million tons," — said the analyst FCStone Ana Luisa Lodi.

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