Argentina has 1.7 million tons of wheat leftovers

A trading company from Argentina has revealed to Brazilian consultancy Trigo & Farinhas that the country has nearly 1.7 million tons of wheat available to exports, but currently cannot be exported. Argentina produced 10.3 million tons of the cereal in the 2013/2014 season and used 5.6 million tons for domestic consumption. The government authorized a quota of 1.5 million of exports that already was sold. About 500,000 tons of the stock were used for seed reserves. Therefore, that leaves the South American country with 1.7 million of wheat leftovers.

There are reports of conversations between the government, farmers, and traders, but there still isn’t no prediction of when an additional quota would take place. Brazil has currently demand for Argentina’s wheat, but would start its harvest within a month.

Wheat supply and demand ratio incrased 17.39% in the Mercosur bloc

According to data released by Trigo & Farinhas consultancy, the ratio of final stocks of wheat and domestic consumption of each year in the Mercosur countries (Brazil, Uruguay, Paraguay, and Argentina) is 17.39 percent. The consultancy also forecasts that prices would not overcome R$ 620 (US$ 278.49)/ton. “The main cause of this is a total wheat production increase of 26.69 percent in the Mercosur. That is the price trend if the weather or a war do not change everything”, says Luiz Pacheco, editor of the Trigo & Farinhas bulletin.

In Argentina, the production of the cereal jumped 19.04 percent to 12.5 million tons. In Brazil, it would increase 33.84 percent to 7.3 million tons, and 128.19 percent of bigger output in Paraguay.  The only country in the bloc that will reduce the production is Uruguay with 31.2 percent less. Therefore, the stocks would finish 31.95 percent higher.

Soybean production costs rise 5% annually in Brazil

The soybean production cost has risen nearly five percent on average since 2009/2010, according to a survey from international consultancy INTL FCStone. The average cost to date jumped from R$ 1,847 (US$ 828.62) per hectare in 2009 too R$ 2,359 (US$ 1,058.32) per hectare in 2014. The main aspect considered for the inflation was the cost of seeds, agrochemicals, and fertilizers. There was also the local currency devaluation in the period, which boosted the inputs prices.

Argentina: strike in Rosario stops grain exports

Exports of grains and other commodities have stopped in Rosario since yesterday, according to local unions. “Truck cannot be unloaded and the barges cannot be loaded. Everything stopped”, Guillermo Wade, manager of the maritime activities chamber, told Reuters.

Even after losses, wheat area in Brazil’s Rio Grande do Sul will increase

The Brazilian state of Rio Grande do Sul will increase its wheat area compared to last year to 2.7 million acres, according to agronomist Carlos Dellavalle, owner of DeAgro. Last month, there were reports of losses to some farmers, but the wheat surface is still expected to be a record.

Delkavalle says that planting is delayed and there is still 15 percent of the area to go. According to him, however, this expansion is not very good because prices are lower. “By the time planting was projected, there was a good demand because of the Crimea conflict. With the conflict, there were estimates of higher prices, but this was confirmed and, even worse, the government dropped the external tariff on imported wheat”, Dellavalle told Brazil’s portal Agrolink.

Soybean profits would be the smallest in five seasons in Brazil

The profitability in the Brazilian state of Mato Grosso in the 2014/2015 season will be the smallest in five years. In 2010/2011, the profits corresponded to 36 percent of the market value of each ton sold. This year the ratio might be 23 percent, reflecting the soybean values of the first days of July and production costs. The data was released by international consultancy INTL FCStone.

Analyst Natália Orlovicin said that the average profits per ton dropped from R$ 229.70 (US$ 102;45)  to R$ 195.96 (US$ 87.22). It is important to note that the study was released before the soybean rebound in Chicago yesterday.

Brazil’s Paraná wheat production still estimated at 4 mln tons

According to the Department of Agriculture of Paraná, a southern Brazilian state, the wheat production is estimated at four million tons in that state. Ninety eight percent of a 3.3 million acres surface was already planted. Of those, nearly 87 percent are considered in good conditions, which a significant drop from recent weeks.

Currently, the price paid domestically for Brazilian hard wheat is R$ 750 (US$ 337.38)/ton, while the wheat from the United States is paid R$ 768,41 (US$ 345.8/ton) and the Argentine worth R$ 736.45 (US$ 331.29), according to Trigo & Farinhas consultancy.

Soybean sales reach 82% of current Brazilian harvest

Soybean sales have advanced in the last weeks in Brazil, but the contracts are still at a lower pace compared to the previous crops. According to Porto Alegre consultancy Safras & Mercado, farmers have sold 82 percent of the 2013/2014 soybean stocks until July 11th, which is 71.1 million tons. A year ago, nearly 84 percent of the stocks were sold. In 2011/2012, approximately 95 percent of the output was sold.

Luiz Fernando Roque, an analyst at Safras & Mercado, said the volume of sales is the largest so far and just the pace is slow. The total output expected for this crop is 86.6 million tons.

Depressed Prices not Seen Dropping Brazil’s Soybean Acres

By Luís Vieira

When soybeans reached their lowest value in Chicago since February, US$ 13.63 a bushel last week, it may have turned the red light on for some farmers. That is not the case, however, for the majority of growers down in Brazil.

Currently, most Brazilian farmers are buying inputs and getting ready for the new soybean crop. The value of the oilseed is an issue of concern, but farmers believe that prices can rebound or in the worst case, move to a point where they are just able to pay the bills. On the other hand, international corn prices may push for a possible corn area reduction in Brazil and perhaps a slight soybean area increase.

Early estimates authored by Carlos Cogo, a Porto Alegre market analyst, predict that the Brazilian corn area, including both the summer and winter crop, would drop 0.1% to 38.8 million acres, while the soybean area could increase 2.9% to 76.5 million acres in 2014/2015. In some regions, however, corn is felt to have a larger drop in planting intentions.

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Paraguay would produce 3.3 mln tons of corn

According to a report from Agridatos consultancty, Paraguay’s total corn production is estimated at 3.3 million tons this year. The number was revised down because of a decreased second corn crop area of nine percent.

A volume of 3.07 million is expected to be exported, while the domestic consumption is 1.15 million tons. Agridatos also says that the year would end with a volume of 268,000 tons in corn stocks. The initial volume is 1.1 million tons.