The imports of wheat from the United States will be around 500,000 tons during the 2016/2017 season, according to the Brazilian Association of the Wheat Industry. This considering from a total of five million metric tons of imports, which would come mostly from Argentina.
“If these projections are accurate, about 90% of the imports would come from Argentina and about 500,000 tons would come from the United States,” said Marcelo Vosnika, president of the Association.
The larger crop in Argentina will lower the imports from the United States, which in recent years had been around one million metric tons, sometimes reaching 1.5 million metric tons. In the first half of 2016, there were imports of U.S. wheat at 218,000 tons comparing to 230,500 metric tons imported in the same period of 2015. The overall imports are at 3.36 million metric tons, which is 11.4 percent higher than last year.
The Mato Grosso Institute of Agricultural Economics (Imea) has released new data about the costs of the new soybean crop. It says that, on the eve of the end of fallowing, the cost per hectare to buy inputs reached R$ 3,212 (US$ 993.35), which is a new record. This was not expected because the Real, the country’s currency, has strenghtened in the last few months.
Researchers of Argentina’s Climate Institute and the National Institute of Agricultural Technology (INTA) have forecast that there will be excessive rains during both corn and soybean planting in the country. The high moisture will affect the areas of east of the Entre Ríos province, center-south of Buenos Aires, northeast of Córdoba and north of San Luís. On the other hand, there will be lower than average rains from October to November in Northwestern Córdoba. Finally, a lot higher than average rains are expected for March and April, when harvest starts in Argentina.
The best window to end the wheat planting in Argentina is about to end and the works would need to be finished just in the southeast of the Buenos Aires province, according to data released by the Brazilian consultancy Trigo & Farinhas. Through an advance of 2.2 percent in a week, the planting reached 99.5 percent of the projected surface in the country, but just 44 percent of that area is considered under very good conditions due to weather problems. The surface is 19 percent bigger than the previous season.
The Association of Argentine Corn (Maizar) has announced that a growth of 25 percent of the corn surface in Argentina will be possible and “likely” for the 2016/2017 season. The production, according to the association, has been more profitable in several regions of the country and there is a bet that there will be “record yields”.
“The expectation that we have now was never seen before. It would not be rare if we have the highest corn surface ever. The jump will be huge,” said Martín Fraguío, one of the Maizar leaders.
The Association of Corn and Soybean Growers of Goiás, the fourth largest soybean producing state in Brazil, has commemorated the revoke of export tax on soybeans in that state. The state had previously imposed an exported on 30 percent of the corn and soybeans that leaves that jurisdiction, but it was eliminated last week. “Now we hope that prices return to the values that we had previously to the tax and that companies have freedom to do business in Goiás,” said the president of the association, Bartolomeu Braz.
The sales of agrochemicals for the corn and soybean crop of the 2016/2017 season in Brazil already reached half of what was expected, according to the country’s National Association of Agricultural Inputs. Comparing to the previous year, there were sales of about 80 percent at this same month. Experts blame the currency instability for the cautious moves of the farmers. Due to logistical problems, several agrochemicals could not be delivered recently.
A study released by the França Júnior Consultancy has brought a partial balance report of the gain of the Brazilian soybean growers considering the first half of the year. Contrary to what happened last year, the overall performance was positive. According to França Júnior, the results were influenced by the favorable prices and the gross profits of the last ten consecutive years. The yields are the best since 2012, says the study.
Even though there were recent cuts of production estimates, the recent weather in major producing regions of Argentina have not generated new projection cuts for wheat production. According to the Rosario Board of Trade, the total outcome would still be 11 million metric through a surface of 4.5 million hectares. All provinces have ended planting, except the Buenos Aires province that is in the final stretch. Comparing to the previous year, the output volume increase would be 18 percent if those estimates are confirmed.
An associate at Agroconsult, André Pessoa says that the corn stocks in Brazil would continue to be low next year, even if the estimates for a supercrop are confirmed. He explains that the competitiveness of the cereal, all the surpluses would be exported because of a lower cost cost comparing to the U.S., its major competitor.
Major corn cosumers in the country such as Brasil Foods, AB Inbev and Aurora Cooperative should anticipate their purchases. A complicated situation in the supply chain will continue to be the hog farmers. An eventual increase of imports of U.S. corn would not contribute to drop the cereal price in the country, according to Pessoa.