Across the regions tracked by Cepea, the average decline in derivative prices was 4.1% from December to the first half of January. When compared annually, there is a notable devaluation of 19.8%.
In the beginning of 2024, soybean meal prices started to decline due to the absence of buyers. Most consumers indicated sufficient medium-term stocks, opting to postpone new purchases, anticipating lower prices in the latter half of January based on the progress of the raw material harvest.
Moreover, a surge in the global supply of soybean meal is anticipated, primarily driven by Argentina. The favorable crop conditions are expected to restore Argentina to the position of the third-largest oilseed producer in the 2023/24 harvest.
According to a report released on January 12 by the United States Department of Agriculture (USDA), soybean meal production in Argentina was revised to 27.7 million tons, showing a 2.9% increase from the previous estimate and a substantial 17% rise compared to the previous season.
Consequently, Argentine exports of the derivative were adjusted to 24.4 million tons, reflecting a 4.3% increase from the previous report and a significant 17.6% surge over the volume sold in the last harvest.
With the heightened supply in Argentina, this season is expected to see reduced competition between domestic and foreign buyers. The USDA lowered Brazil's export estimates by 6.8% compared to the previous report and by 3.9% compared to the volume sold in the last harvest, projecting the most recent estimate at 20.5 million tons of soybean meal.
On average, across the regions monitored by Cepea, derivative prices experienced a 4.1% decrease between December and the first half of January. In the annual comparison, the devaluation is notably significant at 19.8%.
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