There is a soybean campaign underway that will be hard to forget. The drop in prices on the international market is now adding to the meager harvest. Despite the increase on Monday, soybean and corn prices have declined sharp decline in the international market last week
Gone are the prices of 2022, which on average were historical. And they have generated record revenues for the country of more than 36,000 million dollars.
The price of oilseeds in the Chicago market was $527 on Friday the 12th, the day the decline began. But as the days passed, the price of the crop began to fall to $480 on Friday, its lowest since January 2022.
This Monday it recovered part of the loss and reached US$ 492. In any case, in 10 days it lost US$35 (6.7%).
According to Esteban Moscariello, commercial executive of Díaz Riganti Cereals (DRC), the downward pressure on soybeans is due to the Good prospects for the new crop in the USs, with rapid progress in planting and favorable weather conditions so far.
“China still needs to buy enough soybeans to cover August needs, prices could improve. For now, the only bullish wildcard we see is bad weather in the US, which could be drier than normal in the coming months,” the analyst said.
Similarly, Juan Manuel Uberti, an analyst at the Grassi brokerage, added that the confirmation of Brazil’s record harvest of more than 150 million tons is also having an impact.
Values in the local market also failed to rebound despite the implementation of the third edition of the soy dollar, which closes on May 31st. The bids were for $102,000, a price the producers aren’t convinced of.
So far, farmers sold just over 6 million tons54% less than during the first soy dollar accrual, but 4% more than the second program accrual.
In turn, the price of corn in the Chicago market has also fallen in recent days and closed today at $224 versus $254 it closed 10 days ago, down 12%.
“The pricing situation is worryinge,” Moscariello warned about the cereal. As he indicated, prices in Chicago broke supports and hit their lowest since November 2021.
Given this situation, by the Chamber of Industry of the Argentine Republic (Ciara) this year they will stop inserting US$19,000 million. Already between January and April 2023, agro-exporters liquidated $5,237 million, $5,861 million less than in the same period in 2022.
Meanwhile, soybean yield estimates continue to decline. The Buenos Aires grain exchange has once again cut agricultural production by 1.5 million tons and predicts a volume of 21 million tons52% less than the previous cycle.
The cut of the institution took place because the harvested yields were lower than expected, especially in the central region of the agricultural area. And there have been significant losses of second-grade soybean acreage.
According to the institute’s data, the harvest covers almost 70% of the area, and the national average yield so far is 1,520 kilos, even falling below the aforementioned 2008/09 campaign, with 1,920 kilos, which was also affected by the drought.
As for maize, the second most important cereal in the country, the Buenos Aires Grain Exchange maintained its production projection at 36 million tons, 29% less (15 million tons) than the average of the last 5 campaigns.
Charles Arterburn is a seasoned business journalist for News Rebeat, where he provides comprehensive coverage of the latest trends and developments in the world of finance and economics.