Increased soybean crop forecasts increase pressure on prices, including in Ukraine

In Brazil, as of April 11, soybeans were threshed on 84% of the area (86% last year), and good yields allowed to increase production forecasts. The Conab Agency forecasts that Rio Grande do Sul will increase soybean production by 68% compared to last year and become the second largest producer after Mato Grosso, compensating for the losses from drought in the Central and Western regions.

At present, farmers in Rio Grande do Sul have sold only 16% of their harvest amid low soybean prices, while usually 40-45% is sold by the end of April.

Experts from Cotrisal, which works with 11 thousand farmers in the region, explain the low sales by the reduction of export demand and higher than last year stocks of producers. Last year, the ports were overloaded with significant export volumes of soybeans and corn.

Safras & Mercado raised the forecast of soybean harvest in Brazil from 148.6 to 151.2 mln tonnes amid high yields in the southern states.

In 2023/24 MY (as of April 11), the U.S. exported only 38 million tons of soybeans from the USDA’s forecast of 46.3 million tons (54.2 million tons in 2022/23 MY), which is 18.5% lower than last year’s pace and increases pressure on prices.

May Soybean futures on the Chicago stock exchange yesterday fell 1.4% to 425,6 $/t (-2% for the week) amid higher crop forecasts in South America.

President of the Argentine Chamber of petroleum industry Ciara-CEC Gustavo Idigoras said that Argentina is completing the procedure for obtaining certificates for export of soybean products to the United States, which lowers the price of soybeans in the United States, especially since last year the permission to use canola oil from

Canada for biodiesel production significantly collapsed the price of soybean oil.

In Ukraine, the purchase price of soybeans with GMOs remain at the level of 400-410 $/t with delivery to the Black Sea ports, but amid the appreciation of the dollar to 39.59 UAH/$, hryvnia prices rose to 18300-18400 UAH/ton. Processors raised prices by 300-400 UAH/t to 17300-17800 UAH/t with delivery to the plant.

Competition between processors and exporters has increased, but in may on the world market will be soybean products from Argentina and Brazil, which will complicate exports.

Demand prices for soybeans for delivery to Italy remain at 430-440 €/t DAP, but expensive logistics make exports impractical. As of March 27, the EU imported 9 mln tonnes of soybeans, including 5 mln tonnes from the US, 2.5 mln tonnes from Brazil and only 680 thsd tonnes or 11% from Ukraine.

Tags: Ukraine, Brazil, prices, soybean, Canada, USA, Argentina