Soybean prices closed lower today for the third consecutive round on the Chicago Stock Exchange, where the wet weather recorded in agricultural areas of Brazil, Paraguay and Argentina affected the market, where, however, the rains are up to At the moment very heterogeneous and incapable of modifying a scenario that already includes inexorable losses due to the drought that affected the development of crops.
At the close of business, the boards reflected losses of US$3.13 and 3.12 on the March and May soybean contracts, whose adjustments resulted in 500.17 and 503.76 dollars per ton. From the US soybean complex, the biggest losses of the wheel were suffered by flour, with a value for the March position that fell by 3.8%, going from 447.09 to 430 dollars per ton. The soybean by-product had been accumulating strong increases in the preceding weeks due to the chance that losses in Argentina would raise the level of US exports.
The very measured impact of the rains on soybean prices responded in particular to what has been seen so far in Brazil. “It has been raining in recent days, but the volumes were small and their distribution was uneven,” Daniele Siqueira, a market analyst at the firm AgRural, told LA NACION from Brazil. He added that Rio Grande do Sul received a maximum of 40 millimeters, “a low volume in the face of very high temperatures that continue to punish soybean and corn crops in that state. In Paraná, it continues to rain better in the eastern two-thirds of the state, which is good for crops planted later, but in the west, the soybean crisis is very, very serious and continues to worsen. Similarly, in the south of Mato Grosso do Sul, producers continue to worry about the lack of rainfall.”
According to the specialist, in proportion, the rainfall received by Brazil was lower than the falls in Argentina since the weekend. “In summary, the recent rains are welcome, but so far the relief they have brought is limited. After the last cut from the 144.70 million tons forecast in December, we continue with our estimate for the soybean crop at 133.40 million tons, data that will be reviewed at the beginning of February. Until then, rains are forecast for the next 15 days over the south of Brazil, with the highest volumes announced for Paraná and with little expectation of water for Rio Grande do Sul,” Siqueira warned. Behind Mato Grosso, these two States occupy the second and third steps on the podium of the largest grain producers in the country, respectively.
Yesterday the National Supply Company, dependent on the Brazilian Ministry of Agriculture, revealed the progress of the soybean harvest over 1.7% of the suitable area, against 0.3% at the same time in 2021. In Mato Grosso it is already collected 5.1% of the surface and in Paraná, 2% of the area.
At the local level the reading does not differ much. According to Cristian Russo, head of estimates at the Rosario Stock Exchange (BCR), the instability will continue until Sunday. “There are probably many areas of the Pampas region with accumulations greater than 50 millimeters, which was the minimum needed to begin to leave the lack of water behind, but we also see that there are many other areas that are going to continue to be very complicated, such as the entire central-eastern fringe of Buenos Aires”, the specialist told LA NACION.
He warned that today the scene is partial and that we will have to wait to see what the entire sequence of rains holds, their accumulations and their coverage, to analyze with a greater degree of certainty their influence on crops.
“We must not lose sight of the fact that the last days of extreme temperatures, prior to the rains, were lethal and accentuated the reports of serious losses that we had already been receiving from areas of the core zone. The rains help to turn the page in a good part of the Pampas region from the drought conditions, but it is necessary to analyze what was left in the lot to be revitalized with this contribution of humidity, because the basic situation was really very delicate before the arrival of the precipitations”, explained Russo and added that there will be a lot to relieve from next week.
Last Wednesday the BCR reduced from 45 to 40 million tons its expectation on the volume of the soybean harvest in Argentina and from 56 to 48 million its expectation on corn production.
In Chicago, corn prices closed today with slight increases due to the upward influence of wheat and a scenario for South America that would still need more moisture to get back on track. At the close of operations March and May cereal positions totaled US$1.28 and 1.08, while their adjustments were 236.01 and 236.21 dollars per ton.
Regarding wheat, which came from three consecutive downward weeks, an active buying position of the large investment funds made it possible for the March position of Chicago and Kansas recover US$10.11 and 10.20, going from 272.45 to 282.56 and from 273.74 to 283.94 dollars per ton, respectively.
The prices of Argentine soybeans did not register significant changes today, given that buyers once again offered up to 385 dollars per ton of soybeans with immediate delivery at the Gran Rosario terminals. Its equivalent in local currency, of 40,028 pesos, exceeded the 39,056 pesos calculated by the BCR as the theoretical payment capacity of the export oil industry.
Regarding soybeans for the next harvest, for deliveries between April and May, the interested parties adjusted their proposals from 352 to 350 dollars per ton.
Matba Rofex charts reflected an improvement of US$2 for the February position, which went from 380 to 382 dollars per ton, and stability at 356 dollars for the May contract.
Per ton of corn with immediate delivery, exporters kept their offers unchanged, at 250 dollars per ton for Bahía Blanca and 220 dollars for Gran Rosario. This price gap has to do with the Paraná crisis, which continues to force buyers to originate more merchandise on the south of Buenos Aires to complete the ships at the maritime terminals.
Corn for the next harvest, for deliveries between March and April, also remained stable, given that interested parties offered 245 dollars per ton for Bahía Blanca and Necochea, and 215 dollars for Gran Rosario.
The February and April corn contracts on the Matba Rofex lost one dollar and closed with adjustments of 226 and 220 dollars per ton.
As for wheat, the movements were concentrated on the southern ports, with improvements in the proposals of the exporters from 235 to 245 dollars per ton for Bahía Blanca and from 235 to 240 dollars for Necochea, while for the Gran Rosario the offers they remained at 231 dollars per ton.
The March and July positions of wheat on the Matba Rofex added US$1 and 0.50, ending the day with adjustments of 241 and 243 dollars per ton.