The corn from Mato Grosso was traded at the worst prices in this first week of July since September of 2010, according to a survey from the Institute of Agricultural Economics of Mato Grosso (Imea). For instance, in the city of Lucas do Rio Verde the prices were at R$ 10.17 (US$ 4.49) for the bag of 60kg. The fall is happening because of the crop estimates for the United States and the ongoing harvest in Brazil. In Mato Grosso, currently, the second corn crop harvest is under 35 percent.
The Imea analyzes that the opportunity for Mato Grosso farmers would lie a possible break in the American corn crop. Farmers from that Brazilian state, on the other hand, are happy with high cotton prices. The bushel of cotton was sold between R$ 60 (US$ 26,51) and R$ 70 (US$ 30.93) in recent weeks. Imea also projects that these cotton will be even higher in the near future.
Brazil’s minister of Finance, Guido Mantega, announced that the Brazilian government is likely to anticipate tax exemption on imports of fertilizers and other agrochemicals. He says that the exemption will last 12 months and it is aimed to curb inflation in the country. According to Mantega, there is no need for the protectionist measure right now because the dollar value is higher compared to the Brazilian Real.
“The dollar is floating, but, at this moment, is more valued than in September of last year. This way, it creates a natural defense for those inputs. We just cannot assure this now because we depend on the dollar”, explained Mantega, without mentioning how big the exemptions would be.
Oscar Aguad says that would be a crime if the Argentine really seizes wheat from local farmers
Oscar Aguad, a representative from Argentina’s Radical Civic Union, said that if Guillermo Moreno, the Minister of Domestic Trade, applies the Supply Law and seizes wheat from local farmers, Moreno would be committing a crime. According to Aguard, the law is already expired and when it was approved (in 1974), it delegated most powers to the legislative branch. Last week, Guillermo Moreno announced and signed a resolution that the Supply Law would be taken into effect.
“If Moreno seizes (wheat) supported by a law that is not in force, this is theft, and if he does by force, it is a robbery. The paradox is that Moreno is the person that should hold accountable for the wheat shortages in Argentina”, Aguad announced yesterday.
The Argentinian corn harvest has reached 84.1 percent of the total area, according to the Buenos Aires Cereal Exchange. The yields are already at 20.4 million tons of corn. The projection for the whole season is 24.8 million tons, which is 15.4 percent higher than in the last season.
The Colombian production of coffee increased 28 percent in June compared with last year, according to Colombia’s National Federation of Coffee Growers. The country produced 913,000 bags (60 kg). Compared to May, on the other hand, production has fallen by 2.56 percent.
Considering the first semester, the Colombian coffee yields jumped 35 percent to 4.93 million bags. In 2012, Colombia had the worst coffee crop season in 2012. The country renewed 780,853 acres from 2010 to 2013. The Colombian coffee is known as one of the suppliers of Starbucks.
According to Brazil’s Ministry of Development, Industry, and Foreign Trade, the country has exported 18,400 tons of corn in June. This amount has prompted a projection from Scot Consultoria, which says that Brazil will export more in August. Another reason for the increase might be the advanced harvest of second corn corp, or safrinha.
From January to June, Brazil has exported 8.5 million tons of the cereal, which is 4.7 times more than the first semester of last year. Conab (National Supply Company) forecasts that the country will export 15 million tons in 2013. Last year, 22.3 million tons of corn were exported.
Argentinian feds will be able to seize wheat and even to arrest farmers who export wheat. Photo: Government of Argentina
A new law in Argentina regarding wheat seizures was taken into effect today. The law authorizes the Ministry of Domestic Trade, Guillermo Moreno, to seize the grain from exporters and dump the domestic market to acquire the mills by applying a Supply Law. The norm was sanctioned 39 years ago, but was suspended since the 90s by local courts. Now, federal employees are able to arrest or to fine Argentinian farmers that do not want supply wheat for the local market.
The changes are a result of a resolution signed by Moreno yesterday. The resolution will be probably be analyzed by the courts in some months. Employees from the Argentine government will be allowed to apply from US$ 92 to US$ 194,973 penalties, according to an update of the law in 2002. Farmers can be in prison up to 90 days if the penalties are not paid.
The Argentinean Association of the Experimental Agricultural Consortium (Aacrea) has communicated yesterday that the market has even more preoccupations than this governmental intervention. According to the Consortium, there is not enough high quality wheat available at the local market because of excesses of water in some regions, which would impede bread-making.
Juan Balbín, president of Aacrea, suggests that the government could open the market for Uruguay and US wheat in order to reach its goals.
The Uruguayan Association for Protection of Vegetal Obtainers announced that the area of soybeans planted in Uruguay is nearly 3.2 million acres. The estimate is done based on the number of seeds purchased in the country. Daniel Bayce, manager of the Uruguayan Chamber of Seeds, explained, on the other hand, that the number could be slightly higher because there is an amount of seeds which is not declared by growers.
The soybean area was increased in 47 percent compared to last year. Some farmers expect that the area will be higher than the projections and Uruguay would set a record of soybean production.
A recent announcement by port union workers in Brazil may impact the grain market in a few days. Brazil’s Força Sindical (Union Force), one of the largest union confederations in the country, is about to call a strike in all Brazilian ports on July 11. According to union leaders, president Dilma Roussef broke her promise when she said that ports would not be privatized.
In late May, the commodities reacted with soybean prices soaring when Brazil’s main southern ports of Santos and Paranaguá stopped shipping grains. After a meeting with the president, most union leaders have decided to stop the strike, but they say there were not attended. “The government is taking a lot of measures without asking anything to us. The union leadership was fooled by the government”, said Wilton Barreto, president of the National Federation of Stevedores.
Marfrig’s beef division will be divided into two major offices, the Brazilian meat giant has announced. The production unities in Chile, Uruguay, Argentina, and the state of Rio Grande do Sul (Brazil) will be under the supervision of Martin Secco, in Montevideo. Secco has 25 years of experience in the beef sector. He is responsible for Marfrig’s Uruguayan and Chilean operations since 2007. The executive will report directly to Sergio Rial until January 1st of 2014. Then, Marcos Molina will replace as president of the board of directors. The Board of Directors is in São Paulo, Brazil.