Soybean prices rise slightly on the Chicago Stock Exchange this Monday (2). A new month begins for the international market and oilseed prices still have difficulty defining a direction given the lack of news about relations between China and the United States.
Around 8:30 am (Brasília time), prices rose between 1.75 and 2.25 points in the main maturities, taking January to US$ 8.78 and May/20, an important reference for the Brazilian harvest, to US$ 9.07 per bushel.
Alongside the information about the trade war, traders are divided between the conclusion of the US harvest, with the harvest practically finished, and the development of the new harvest in South America. The weather conditions, at least so far, are favorable in most producing regions.
“With pessimism over the lack of announcement of a new agreement, traders are impressed by China's heavy purchases of American soybeans in recent weeks. However, they are not moved by this and the market remains on the defensive, understanding that once the Brazilian harvest begins, these volumes are likely to plummet”, explains Steve Cachia, market consultant at AgroCulte and Cerealpar.
IN BRAZIL
The focus of business in Brazil remains on the dollar. The American currency has had days of intense rises, leading to better prices in the national market, good business and offsetting the declines seen on the Chicago Stock Exchange.
The American currency continues to operate above R$ 4.20 and experts still expect intense volatility at the end of 2019. “The question the market is asking is whether the Central Bank will intervene more energetically or whether we will see new highs” , says Cachia.
In Brazil, as market consultant Vlamir Brandalizze, from Brandalizze Consulting, explains, attention should also be paid to domestic demand, where industries are still active in purchases and paying better than exports in some locations.
“Industries must come to the field to obtain supplies, but the ports will remain firm due to the trade war between the USA and China, which should maintain a good presence of buyers in Brazilian ports. As we are at the peak of the off-season and with little soybeans to be traded, there is a call for maintenance and even a call for some positive price adjustments. The domestic market remains firm this coming week”, says Brandalizze.
Source: Notícias Agrícolas
