In the fields of Pergamino, in the heart of Argentina's grain-producing region, farmer Adrian Farroni is accelerating his grain harvest. soy, delayed by rains that, along with low prices, led to the country's slowest soybean sales in a decade.
The slow pace of sales of the South American country's oilseed could harm the region's supply, even with Brazil's rival crop being damaged by major floods. Furthermore, Argentina processes soybeans to export soybean oil and meal, being one of the largest global exporters of these products.
By early May, Argentine farmers had sold 31% of an expected soybean crop of 49.7 million tons. This is the slowest pace since at least the 2014/15 campaign, according to government data.
“We usually start harvesting in April, but it was drizzling and drizzling,” Farroni said from his fields, where two combines were working to resume harvesting during a window of cold, dry weather. “So each week we only harvested for two days, and for five days we had to stop.”
As of last Wednesday, farmers had harvested 61% of soybean acreage, government data shows. Even falling behind last season's harvest pace, which the drought affected.
Bad weather and low prices paralyzed sales, says Dante Romano, researcher at the Agribusiness Center at Universidade Austral in Rosário. Generally, farmers agree to sales before fully harvesting the crop.
“The pace of sales has been really slow, one of the slowest we’ve ever had in history,” said Romano, who estimated that deals were closed for just 12% of the soybean crop, about half the average pace for this time of year.
“Stalled” soybean sales and prices
At the beginning of the year, farmers received US$ 270 per ton; Romano encouraged them to store soybean stocks and wait for the market to recover.
“The producer was making losses with these prices, which left sales completely paralyzed,” said Romano.
Soybean prices are now starting to recover as concerns about crop losses due to flooding in Brazil and drought in northern Argentina offset data indicating lower demand from the US.
On the futures market in Rosario, Argentina, soybean futures for July are trading at around $315 per ton, down from $350 during planting at the end of last year, but above recent lows, which according to analysts, was spurring a modest increase in trading.
Farroni was betting on increases in the price of soybeans, selling wheat and vegetables to stay afloat, while saving his soybeans.
“It’s still not tempting to sell soybeans,” he said. “Those who can hold on and postpone sales are waiting.”
Source: Maximilian Heath | Notícias Agrícolas
