According to the weekly analysis by the International Center for Economic Analysis and Agricultural Market Studies (Ceema), released this Thursday (27), the prices of soy in Brazil suffered a slight drop during the week of March 21 to 27. With the exchange rate varying between R$ 5.70 and R$ 5.75 and positive premiums between US$ 0.75 and US$ 1.15 per bushel at ports, the downward pressure observed in Chicago was reflected in domestic negotiations. In Rio Grande do Sul, the main markets closed the week with the price of a 60-kilo bag of oilseeds at R$ 125.00, while the state average was R$ 127.60. In other markets in the country, prices varied between R$ 104.00 and R$ 119.00 per bag.
The consultancy firm points out that, despite external pressure, premiums are helping to maintain domestic prices. Mainly due to the trade war between the US and China. This scenario causes China to increase its purchases of soybeans from Brazil and Argentina. If premiums were at lower levels, domestic market prices would be significantly lower. The average in Rio Grande do Sul, for example, would be around R$112.00 per bag. This would represent a drop of R$13.00 compared to the current value.
Soybeans: China boosts Brazil amid decline in RS
Regarding the 2024 harvest, Ceema reports that 74% of the area had been harvested by the end of the previous week, an increase compared to the same period last year. However, the consultancy AgRural revised its estimate for soybean production in Brazil, reducing it to 165.9 million tons, due to the worsening of the Rio Grande do Sul harvest. The forecast is that the state will harvest between 11 and 13.2 million tons, a drop of 50% to 60% compared to the forecast. The quality of the harvested grain is also below expectations in many regions.
Despite the reduction in Rio Grande do Sul, national soybean production is expected to reach a record. Brazil's final production in 2024 is expected to surpass the 2022/23 record of 155.7 million tons. This is mainly due to good results in other states, such as Mato Grosso. The estimate for the state is a harvest of 49.5 million tons. This volume even surpasses Argentina's production, which is expected to reach around 48.6 million tons.
Source: Seane Lennon | agrolink
