The week ending on Friday (27) showcased significant gains for soybean meal on the Chicago Stock Exchange. During early afternoon, derivative futures surged by over 3%, around 1:30 pm (Brasília time). December prices reached US$444.50 per short ton, marking a 3.5% increase. Concurrently, grain prices rose by over 1%, from 18 to 19.50 points. November prices stood at US$12.97 per bushel, while May prices reached US$13.47.
A potential soybean processing capacity crisis looms towards year-end due to Argentina's lack of soybeans, Brazil's anticipated processing decrease, and the USA operating at maximum capacity, as noted by Agrinvest Commodities. The rapid growth in the American bran export program, surpassing USDA predictions, serves as a key indicator.
Additionally, oil futures within the soybean complex are rising, mirroring the upward trends in bran and grain. Both Brent and WTI experienced gains exceeding 1.5%. Irregular weather in Brazil, featuring dry and hot conditions in the Center-North and excessive rain in the South, is a concern for traders. This weather pattern impacts planting rates significantly.
Agrometeorologist Luiz Renato Lazinski highlighted El Niño's detrimental effect on sowing development, foreseeing consistent rainfall patterns in the medium term. He also warned of extended summers in the Center-North. Predictions for 2024 indicate soybean meal production reaching 42.3 million tons in total, a 4% increase. Exports are expected to drop by 2% to 21.5 million tons, while domestic consumption is projected to rise by 8% to 20 million. Stocks are on an upward trend, increasing by 36% to 3.03 million tons.
Only this season, Brazil is set to export approximately 21.82 million tons of soybean meal, solidifying its status as the primary global provider of this byproduct. This shift was made possible due to the decline in soybean production in Argentina, the former leading exporter. Argentina anticipates a 50% decrease compared to the previous year, marking its poorest performance since 1999/00, as reported by the National Supply Company (Conab).
Additionally, robust demand from Brazil's biodiesel industry has boosted domestic soybean meal supply. This surge has driven up soybean oil prices within the country. Internationally, there's fierce competition owing to the heightened global demand for Brazilian soybean oil. Comex Stat data indicates a significant uptick in by-product exports during this period, underscoring the rise
Until July 2023, Brazil exported 12.9 million tons of soybean meal, surpassing the previous year's figure of 12.2 million tons. Leading the export operations were the ports of Santos (40.6%), Paranaguá (29%), Rio Grande (15.5%), and Salvador (5.7%).
Comments