Never in history have the average prices of soybeans and wheat on the international market been so high, while that of corn has positioned itself among all-time highs.
The average price of soybeans in the Chicago market during 2022 was $570an all-time record, leaving behind 2012 when it had traded at an average of US$539.
This year, the value of the oilseed reached its all-time high when it surpassed the $651 it hit on September 4, 2012, and reached $655 on June 9 during that day’s round.
In the case of wheat, the average value is also historic, which this year was 226 dollars, surpassing 2008 when it reached 204. And it reached its peak on March 8, rising to 467 dollars.
And while the average price of corn in 2022 isn’t a record, it’s been very close. It reached US$273, one dollar lower than in 2012 when it peaked.
“The last cycle was marked by multiple factors which has unleashed a very particular scenario for commodity prices in general”, he began by explaining Ariel Tejeramarket analyst for the Grassi firm.
“It was a year of stagnation for crude oil and oils. The war between Russia and Ukraineinitially triggered great uncertainty about the future of supply. Finally, the markets have adjusted to an environment characterized by lower production from Ukraine and some logistical difficulties,” she explained.
On the other hand, added the analystThe US ended a campaign with low soybean and corn inventory levels. “And the new North American cycle, despite the production volumes achieved, would not be able to significantly reverse this situation. At the same time, in soybean, the 2021/22 cycle was characterized by lower productions in South America, with declines in the Argentina , Brazil and Paraguay,” he explained.
Due to the high prices, the government has had its prize. Foreign exchange settlement by agro-exporters reached 36,731.5 million US dollars between January and November of this year, which means a 22% increase over the same period in 2021, and the highest historical level reached by the sector.
And on the subject of withholding taxes, according to the estimate of the Rosario Stock Exchange (still to close in December) raised US$ 9.614 million with the 6 main crops5% more than in 2021, when it reached $9,104 million.
In September alone, when the first soybean dollar was implemented—$8.1 billion was cleared for a sale of 13.5 million tons of soybeans—the government received $2.11 billion.
soy dollar
Despite the good international soybean price throughout the year, growers were reluctant to part with the bean. Therefore, the government has been trying to speed up the commercialization of grain through marketing stimuli.
Previously it was 70-30% of Silvina Batakis when she was Minister of the Economy, a method that didn’t work. But, after Sergio Massa took over the economic portfolio, the Export Incentive Program (PIE), better known as the soybean dollar, was implemented on two occasions to the benefit of farmers who sold the goods at a better exchange rate .
As the economist of the Fundación Agropecuaria para el Desarrollo de Argentina explains, David Miazzoexcept for the jump in prices (above $500 in the local market) that occurred between February-March due to the war between Russia and Ukraine, before the soybean harvest, producers were generally able to sell at $420 and then, once they came down after the harvest -April-May- they were able to sell at US$380-390 which gives only 10% difference.
“It’s a risk-to-reward ratio. If the potential benefit is a 100% write-down versus the loss from expecting a 10%-15% sale price, I have every incentive to wait. Also, in context in which they did not need liquidity, ”the economist said.
Source: Clarin
