Dollar drops and Brazilian agents become interested in imports again

Cepea, November 4, 2019 – The Real appreciation against the US dollar in October increased the interest of Brazilian purchasers in importing wheat. It is worth to mention that this scenario is opposite to that observed in September, when agents from mills reported that, with the US dollar at high levels, imports were not a good option.


Between September 30 and October 31, the US dollar decreased 3.3%, to 4.012 BRL on October 31, narrowing the price gap between the imported and the national wheat – still, prices for the international product have been higher than that for the Brazilian wheat.


Based on data from Conab (National Company for Food Supply), until the first fortnight of October, the imports price for the wheat from Argentina was at 244.78 USD per ton (for the product delivered in Paraná). Considering the US dollar in the first half of the month, the Argentinean wheat was traded at 1,006.29 BRL per ton, against 833.41 BRL per ton for the Brazilian wheat (in Paraná). Between October 21 to 25, the US dollar dropped more sharply and the product imported was traded at 993 BRL per ton, while the average in Paraná was at 831.62 BRL per ton.


In Rio Grande do Sul, the price for the wheat from Argentina was at 237.54 USD per ton (or 976.53 BRL per ton) in the first fortnight of October. Late in the month, however, the average price for the product imported was at 963.65 BRL per ton, while in Rio Grande do Sul, quotes were at 705.03 BRL per ton.


In Brazil, harvesting advances and growers’ sales needs (to make cash flow to pay for crop expenses) pressed down quotes in many producing regions, mainly in Rio Grande do Sul. In Paraná, quotes were underpinned by lower productivity – it is worth to mention that the weather was unfavorable to crops in PR during the development stage.


FIELD – In Rio Grande do Sul, data from Emater indicate that the harvesting had reached 16% of the area sown until October 24. In Paraná, according to Deral/Seab, the harvesting had reached 82% of the area until October 22 – of the crops to be harvested, 78% are in good conditions, 20%, in average conditions, and 2% in bad conditions. As regards the trading pace, 44.4% of the 2018/19 crop has been marketed. Deral indicated that the output from PR is expected to be 22% smaller than that from the previous season, due to the 13% decrease in productivity.




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