The soybean planting works keep advancing in Uruguay. But several areas of the tiny South American country need more water. Of the 3.2 million acres esimated for early planted soybeans, 2.4 million acres are already planted. According to local analysts, the scenario will be more complicated for soybeans planted in the second window.
Category Archives: Uruguay
Brazilian consultancy Trigo & Farinhas has issued a new projection for the total wheat production in the Mercosur market, which considers Argentina, Brazil, Paraguay, and Uruguay. The consultancy expects that Argentina would produce 17.5 million metric tons, which over six percent higher than in the previous crop, but the crops would be smaller than last year in all other countries: Paraguay (694,000 tons), Brazil (4.9 million tons) and Uruguay (600,000 tons).
“Argentina clearly will direct more wheat to Brazil even maintaining a lot of exports to countries outside of the Mercosur,” said Luiz Carlos Pacheco, director of Trigo & Farinhas.
The country of Uruguay has released its new official grain stock numbers. The South American country has 1.4 million metric tons of soybeans, 123,157 tons of corn and 305,140 tons of wheat. The majority of the soybean stocks are located in the region of Colonia, while there is more corn in Rio Negro. The data is from the Ministry of Livestock, Agriculture and Fishery.
Most analysts agree that in an eventual protectionist wave of the next president of the United States, Donald Trump, China could react by putting import taxes on U.S. grain or just not buying so much U.S. corning, seeking another suppliers such as Brazil, Paraguay and Argentina. Dave Holloway, a trader from the state of Michigan, it could be a problem for the United States if Trump confirms this policy. As candidate, he mentioned a possibility of 35 percent tariff on Chinese products, which was later denied.
“If Trump puts in practice this fight, the prices would increase and three countries [China, Japan and Mexico] would go to Brazil. We are not the only store in town. The Chinese would be happy to help the Brazilian infrastructure,” affirmed Holloway.
For Darin Fessler, a broker from Lincoln, Nebraska, says that “only time will tell about the ability of Trump to negotiate with China or Japan. I think there could be some good changes made to the manufacturing sector and currency side of things,” Fessler told AgroSouth News.
Corroborating with these opinions, Brazilian market analyst Antonio Sartori from BrasilAgro says that is more likely that Trump goes with complaints to the World Trade Organization against China, but that could suffer retaliation too. “China has spent US$ 100 billion with subsidies for corn, wheat and rice growers and this is out of the rules, “concludes Sartori.
The wheat production in the Mercosur countries (Brazil, Uruguay, Paraguay, and Uruguay) may be three million metric tons lower than previously expected, according to a forecast of the Brazilian consultancy Trigo & Farinhas. The total output in that market would now be 18.7 million metric tons.
“For a while, in my judgement, there will be no need to increase the imports [from outside the bloc], because it just reached that Argentina would put in the market. But, as we have two more months of harvest ahead with bad weather forecasts, the volume of deteriorated wheat can worsen,” affirmed Luiz Carlos Pacheco, director of Trigo & Farinhas.
Nearly two million metric tons would be reduced of the previous estimate of Argentina because of floods considering the estimate of the Buenos Aires Cereal Exchange in its weekly report of October 27th and over 250,000 tons of less output in the Brazilian state of Rio Grande do Sul due to frost and hail recently.
Though a minimum volume, it is the first time in history that Argentina will import wheat. Uruguayan company Granosur announced yesterday that will export to Argentina 300 tons of wheat from Paysandu. This export happens because of a lack of quality of the Argentine production this season. Some experts say that these imports are a “test” that could happen in increased volumes from Uruguay.
As a result of the floods in part of South America, there are estimates that say that Uruguayan soybean growers are likely to lose nearly 500,000 tons. With soybeans priced at US$ 350 per ton, the financial losses might be approximately US$ 175 million. The previous expected volume to be harvested in the tiny country was 2.8 million metric tons. If there are more delays, the losses can be even bigger.
The market already speculates with a possible lost of the strength of the El Niño phenomenon at the first semester of 2016 and, therefore, the coming of La Niña. The forecast is based on data from the Bureau of Meteorology of Australia and the meteorology services of Japan that puts the peak of El Niño during the first semester of next year. An anticipation of La Niña would result in drier weather in both South America and North America. The market reacted with rallies on the prices of palm oil, sugar and dairy products last week. Some consultancies asked by AgroSouth News have put greater risk in the future for the prices of corn, soybeans, wheat, cotton, and coffee.
The wheat output from the countries belonging to the Mercosur bloc may shrink this year because of excess rains in most of the top producing regions. A new projection of consultancy Trigo & Farinhas estimates the total production of the bloc in 18 million metric tons and just eight million metric tons with enough quality to produce bread. Comparing to last year, the wheat used in that same level was 18.5 million metric tons. According to the consultancy, the lower supply, especially going to Brazil, is mostly due to a crop with 800,000 tons less in the state of Paraná and also smaller output in Paraguay.
If those numbers are confirmed, Luiz Pacheco, director of Trigo & Farinhas, says that Brazil will need 5.8 million tons coming from countries outside the bloc. “In my opinion it will come mostly from the U.S. and Canada, but some people say that a part could come from Germany,” forecasts Pacheco. The total Brazilian demand might fall from the 11.1 million metric registered in 2014 tons because of the current recession faced by the country.
By Luís Vieira
SHANGHAI AND BEIJING, China (Agriculture.com) – The Chinese grain stocks, purchase intentions, and production estimates are always an issue of concern and curiosity for the followers of the markets. However, when one goes to China it is relatively easy to find the reasons and the data that some folks may be eager to know in the U.S., South America and around the world.
Perhaps because of China’s censorship and cultural differences compared to western democracies, when the country does make public its numbers and does not explain the reasons for its decisions, the guessing game starts to play out.
In general, a lot of people do not feel very comfortable in China talking about of food and some asked not to be identified. Feeding 1.3 billion persons is one of the major concerns of its central government and keep food security a top priority. But in communism or other closed regimes, it will depend on the persons you talk to.