In a low supply scenario, average price in February is the highest since 2018

Cepea, March 3, 2020 – Wheat supply is low in the Brazilian market, which has reduced liquidity, but kept prices on the rise. In this scenario, in February, the average wheat prices in Santa Catarina (SC) hit the highest nominal levels since July 2018. In Paraná (PR) and in São Paulo (SP), the average prices in February were the highest since August/18, and in Rio Grande do Sul (RS), since September/19.

 

Many Brazilian wheat growers have been away from the market, waiting to trade the batches stocked. These agents have been aware of the strong US dollar – which makes imports more expensive – and the fact that Argentina´s government has increased tariffs on agricultural exports (retenciones) – it is worth to mention that Argentina is Brazil’s top wheat supplier.

 

As regards purchasers, agents from some mills have reported low inventories and, thus, need to resume purchasing wheat. However, these agents claim difficulties to find batches available.

 

In February, the average price in Paraná was 7.1% higher than that in January. The averages in Rio Grande do Sul, São Paulo and Santa Catarina, in turn, were 5.1%, 5.4% and 3.5% higher, in the same comparison.

 

(Cepea-Brazil)

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