The price of soy has risen again and is close to all-time highs

The three main grains produced by Argentina are these days very close to their all-time highs. Soy reached $ 640 today per ton on the Chicago market, wheat was trading at 393 and corn at $ 299 per ton. In all cases, they move in a price range reached only in 2008 and 2012.

News from Ukraine is the main bullish factor, as it is one of the main producers of cereals and oils and its offer for the new campaign is seriously compromised, for agricultural but also and above all logistical reasons. In addition to the delay and reduction of the area under spring crops, Ukraine’s main ports on the Black Sea are blocked by Russian forces and much of their transport and storage infrastructure has been severely damaged.

On the supply side, another upward factor is the drought that hit South America in the 2021/22 campaign, with widespread declines in soybean and corn production in Argentina and Brazil. Global stocks are very tight and any negative climate news in the US, which is in full swing, can generate new leaps in the market. In turn, on the demand side, greater pressure is expected in the coming months because the fuel shortage in the world is already having the effect of increased production of biodiesel from soy and bioethanol from corn.

Other condiments that push up the international concert are the protectionist measures of some producing countries, such as the restriction on palm oil exports imposed by Indonesia or the shutdown of grain exports defined by the Indian government.

In this context, the value of oilseeds have already risen by 30 percent so far this year and corn by 37 percent, both products more than doubled their prices before the pandemic and are close to historical values ​​of 2012, when an unprecedented drought decimated the North American summer harvest and that of the entire Northern Hemisphere. In any case, according to the analyst of the cereal market Sebastián Gavaldá, executive director of the consultancy Globaltecnos, prices are not at the highest values ​​in real terms, because the global inflation of the last ten years must be estimated.

But in any case there is a lightning-fast trend, and to confirm this the Chamber of Petroleum Industry and the Cereal Exporters Center (Ciara-CEC) reported that In May, the Argentine agro-export complex settled foreign currency for 4,231 million dollars, 33 percent more than the previous month. In the first five months of the year, the industry’s dollar revenues accumulated 15,329 million, which in the inter-year comparison marked an increase of 2,028.4 million dollars.