In Rosario, Argentina’s major agricultural port, the value of soybeans reached US$ 267.5/ton yesterday, according to the Rosario Board of Trade. That value is the lowest in the country since 2002.
A study from the Institute of Studies of the Argentinean Republic and Latin America of the Mediterranean Foundation also revealed that farmers from the country receive currently 36 percent less than the average of the last 12 years.
“The scenario of costs and prices has shown a strong deterioration compared to the last crop season,” pointed out Sofía Corina and Emilce Terré, grain experts at the Rosario Board of Trade.
Beef exports in Uruguay will beat soybean sales in value in 2015 for the first time in three years, according to the Uruguayan Federation of Cooperatives. Soybean revenues already plummeted 26 percent in the country. During the 2013/2014 season, the oilseed cost US$ an average of US$ 475/ton, while in 2015 the value is estimated at US$ 360/ton.
The federation expects that sales would reach nearly US$ 1.3 billion through a production of 3.6 million tons – which is below the US$ 1.8 billion generated last year. In the meantime, Uruguay’s National Institute of Beef forecast a revenue with beef of nearly US$ 1.58 billion,
The wheat harvest reached 98 percent of the surface in Paraguay, but productivity is likely to lower, according to consultancy Agridatos from Ciudad del Este. Now, total production is expected to be 1.4 million tons in the South American country. Sales are slow in Paraguay because of the low quality of the harvested wheat.
Data leaked from a meeting of the Brazilian Association of Wheat Industries says that wheat production in the country will fall at one million from what was previously expected. The latest USDA data puts the total production at 6.5 million tons, while the National Supply Company (Conab) predicts a 7.6 million tons crop in Brazil.
The losses happened mostly in Rio Grande do Sul, where rains have damaged the crops in the North of the state. According to consultancy Trigo & Farinhas, brokerages and mills in the state of Paraná expect higher domestic prices of the cereal because of weather patterns and a higher dollar. The consultancy also revealed that a new exemption on the external tariff imposed on US wheat is not likely to happen again this year.
Gustavo Grobocopatel, the executive of Argentina’s leading soybean group Los Grobo, said that at least one million hectares of surface will not be planted in the country – as previously thought. According to him, there will be areas like parts of Córdoba, San Luis, and the Northwest of Argentina are facing severe problems of money scarcity.
“There are a lot of people that think the surface will shrink because of a lack of access to financing or a very expensive financing,” Grobocopatel told a local radio.
The corporate farmer also requested for a change of the current government policies implemented in his country. “Once we had extraordinary wealth, but now what we got are extraordinary losses”, criticized.
The occurrence of frosts and most recently rains in southern Brazil are likely to generate wheat losses. Fungus and other diseases also occurred mostly in Rio Grande do Sul, the second largest producer in the country. There is not an official estimate of the losses, but some independent sources talk about the possibility of 50 percent less production in the Northwest of the state. Another relevant factor is that these weather patterns can generate a major delay of planting of summer crops.
Currently, the USDA puts the Brazilian wheat production at 6.5 million tons, while Brazil’s National Supply Company predicts 7.6 million tons. “These volumes of production can be confirmed, but a smaller volume of bread wheat will be produced. But still everything is indefinite,” explained Luiz Pacheco of Trigo & Farinhas consultancy.
The soybean planting works have stopped in the Brazilian state of Mato Grosso due to the lack of rains in the last few days. The information was gave by Ricardo Tomczyk, president of the Association of Corn and Soybean Growers of Mato Grosso, during a press conference yesterday.
“Planting is delayed and certainly that will mean a fall in productivity, wrong windows of planting and more incidence of diseases”, said Tomczyk. He added that these factors could bring down the forecast of a 27 million tons crop in the state. “These numbers will be revised due to this delay”, affirmed.
Another preoccupation is the possible delay that it can cause later to the planting of the second corn crop and cotton. “Producers will have to work faster and better”, concluded Tomczyk.
The Center of Cereal Exporters and the Chamber of Oil Industry of the Argentina Republic announced that last week the sales of grains in the country reached US$ 386 million. The exporters, on the other hand, did not reveal the specifics of the transactions. In other words, how much was sold in soybeans, corn or wheat.
So far in the year, sales accounted US$ 19.2 billion in Argentina. At the Rosario Board of Trade, the price of soybeans is US$ 269 per ton. Just yesterday, 100,000 tons of soy were traded at the board.
According to a forecast of the Brazilian consultancy Trigo & Farinhas, Brazil will need in order to consume for its food necessities nearly 5.76 million tons of wheat in 2015. Luiz Pacheco, owner of the consultancy, explains that 1.5 million tons would be offered from the state of Paraná and approximately 3.5 million tons would come from Argentina. “There still will be about 1 million tons of American wheat to be imported to mills in the Northeast and North of Brazil”, wrote Pacheco.
Trigo & Farinhas brought a slightly different approach of what was said previously by the Brazilian Association of Wheat Industries. According to the association, there is a perspective that the country would not need significant supply with wheat outside of the Mercosur bloc in 2015 because of higher production in Brazil, Uruguay, Paraguay, and Argentina. From early last year until this month, Brazilian mills imported 5.5 million tons of the winter cereal.
The Buenos Aires Cereal Exchange is now forecasting a soybean surface in Argentina of 50.9 million acres – which would be a new record. Compared to 2013/2014, it would be a growth of 1.2 percent.
Planting in the South American country is likely to start in a few weeks. There is a possibility that these area is not confirmed because of the lower price of soybeans and the higher price of cattle. Therefore, the crops would be replace by the cattle in some regions of Argentina.