Soybeans: Prices rise sharply in BR following the rise of the dollar; stable chicago

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The USDA (United States Department of Agriculture) reported a new sale of 106,000 tons of soybeans to China this Wednesday (8). Sales made on the same day, to the same destination and with a volume equal to or greater than 100,000 tons must always be reported to the US department.

China continues to look for soybeans to cover its domestic demand and the needs of its processing industries, which have low stocks, while soybean meal sales remain strong in the Asian nation.

The news, however, was insufficient to spur stronger gains and oilseed futures ended the day with small losses on the Chicago Board of Trade. The most-traded positions closed this Wednesday’s trading session with small increases of 0.75 to 2.50 points, taking November to US$ 12.79 and March to US$ 12.95 per bushel.

The fuel that could come from the new Chinese purchase ended up finding limits in American terminals still out of operation on the Mississippi River after the passage of hurricane Ida, the favorable climate for the conclusion of the American harvest and the caution that the market tends to adopt before the arrival of the new monthly supply and demand bulletin from the USDA (United States Department of Agriculture) this Friday, September 10th.

In addition, the market still found room for a small recovery in prices after the lows recorded in the previous session, when Chicago ended Tuesday (7) with more than 1% drop.

“The weather is very good, accelerating soy maturation and the harvest in the Delta is in full swing”, explains Ginaldo de Sousa, general director of the Labhoro Group. “And this harvest that’s happening isn’t always going down to port because of the damage in Mississippi, it ends up damming produce and has to sell Chicago.”

And still in Sousa’s analysis, the USDA should revise down the expected yield for US 2021/22 soybeans, correcting the crop as well. However, he also states that demand could also be revised downwards – with a drop in exports – but still keeping ending stocks very tight and, if confirmed, could give a stimulus to CBOT quotations.

BRAZILIAN MARKET

In Brazil, prices in the physical market, in most of the main trading centers, rose following the rise of almost 3% of the dollar against the real. In Ponta Grossa, Paraná, for example, the price rose 2.41% to R$ 170.00 per bag. At the same time, several squares in Mato Grosso ended the day without reference.

The week is shorter for the market and with news expected towards the end, such as the USDA report, which may affect the prices both in Chicago and in Brazil. What gives even more strength to the prices of the rest of the old crop are the surcharges, which have tested as much as $2.40 a bushel above Chicago in ports.

“The producer is selling from hand to mouth,” explains Sousa.

In Paranguá, the spot rose 3.03% to reach R$ 170.00 and in Rio Grande, 2.44% to R$ 168.00 per bag. As for the new crop, gains were slightly more contained – 2.53% and 1.91%, respectively – and closed at R$ 162.00 and R$ 160.00 per bag.

And for the formation of references for the new crop in Brazil, the director of Labhoro reminds that the climate for planting in the country is gradually gaining more importance and that this information will also reach the international market. After all, a crop should come from Brazil – if the weather conditions are right – an offer that could start to balance relations with demand.