Worrying information points to a decline in demand for Brazilian soybeans, reveals T&F Consultoria Agroeconomia. ANEC (National Association of Cereal Exporters) points to a reduction of 3.0 million tons in its export estimate in the 2018/19 season, which would fall from 70 million tons to 67 MT.
“In addition to this, there are comments from several consultancies that Brazilian production would increase again by around 1.44 MT. This would make final stocks jump from the current 603 thousand tons (with indications of rising prices) to something around 6.0 million tons, almost two months of crushing Brazilian industries, driving prices down”, comments the analyst Luiz Fernando Pacheco, from T&F.
Secondly, he says, “we spent the week touring the soybean trading and crushing industries in RS and were informed of how desperate it is to obtain quotas for storage at the port of Rio Grande. Our interlocutors clearly stated that the causes of this attitude are two: on the one hand, a large increase in production in the state, which increased by 1.7MT or 9% this harvest, without the consequent increase in storage; on the other, the reduction in the pace of shipments, which are actually lower than in previous years”.
In fact, the T&F/Alphamar Index for weekly monitoring of shipments of soybeans, bran, oil and corn in Brazilian ports records that the volume of the oilseed fell by around 300 thousand tons, or 4.74% between last week and this week, going from 7.45 MT just a month ago to 6.97 MT last week and to 6.68 MT this week, in the middle of Brazil's export window.
“Following weekly shipments of Brazilian soybeans will be an obligation for analysts. One of the reports said that this reduction in demand also has two reasons: a) the slaughter of more than 1.0 million heads of pigs in China, which reduces the demand for bran and b) the stocks of more than 1.3 billion ( yes, billion) tons that the Chinese government has available, reducing the need for purchases”, concludes Pacheco.
Source: agrolink | Author: Leonardo Gottems
