Cepea, May 20, 2020 – The dollar appreciation against Real increased the competitiveness of the Brazilian soybean in the international market, primarily against the American product. This scenario has pushed up the domestic prices for soybean, which have been on the rise since early in the season – it is worth to mention that this context has encouraged soybean growers to trade a large amount of the crop during the harvesting. Now, with the low volume of soybean remaining in Brazil, uncertainties about the commercial relation between the United States and China and the lower exports incentives in Argentina, prices skyrocketed in the Brazilian market in the first fortnight of May, hitting new nominal records in some of the regions surveyed by Cepea, primarily at ports.
Although the Brazilian production has increased by 4.6% compared to that in the previous year, in southern Brazil, supply is 8.8% lower, due to the crop failures in Rio Grande do Sul and in Santa Catarina. Besides, the strong dollar continues to favor Brazilian exports, reducing the domestic surplus and lowering the world and the Brazilian inventories/consumption ratio.
In the 2019/20 season, the world inventory/crushing ratio is expected to decrease to 33.2%, against 37.9% in the previous. In Brazil, this ratio should decrease from 57% to 44.5% (reference late September).
Between April 30 and May 15, the ESALQ/BM&FBovespa Index in Paranaguá (PR) increased by a staggering 11.8%, to 115.83 BRL (19.86 USD) per 60-kilo bag on May 15 - on the previous day, May 14, this Index had hit 116.27 BRL/bag. The CEPEA/ESALQ Index in Paraná rose by 10.9%, to 107.50 BRL (18.43 USD) per 60-kilo bag on May 15.
EXPORTS – Brazilian soybean exports are in full swing and, now, the USDA indicates that Brazil should supply the world market with 84 million tons between October/19 and September/20. Besides being a record volume, exports estimates are 7% higher than that forecast in April and 12.6% above that shipped in the previous season.
Since October/19, Brazil has exported 53.4 million tons of soybean – 39.9 million tons were shipped between January 2020 and the first week of May. Until April/20, Brazil had exported 31.3% more than that in the same period 2019. Of the total amount shipped, 73.4% were sent to China, according to Secex.
The USDA forecasts Chinese imports to grow to 92 million tons, 3.4% higher than that estimated in April and 11.5% up compared to the volume imported by China in the previous crop.
2020/21 SEASON – In general, the world soybean area is estimated at 126.93 million hectares, 4.3% higher than that in the 2019/20 season and a new record. World production is forecast at 362.75 million tons, 7.93% higher than that last crop. World trades should grow by 5.17%, to 161.93 million tons, and crushing, by 3.56%, to 312.8 million tons, a record.
In April 2020, Brazil exported a record volume of soybean, totaling 16.7 million tons, considering the daily average of shipments at 838.1 thousand tons released by Secex. This volume is 44% higher than that exported in March and 66.5% above that from the same period last year. This year (January to April), soybean exports totaled 35 million tons, a staggering 33% higher than that exported in the same period last year.
As regards soybean meal, considering the average volume exported per day, shipments totaled 1.72 million tons in April, a record for the month and the highest volume shipped since July 2018. Soybean meal exports were 10.4% higher than in March and 13.3% higher than in April last year.