Soybean prices in Ukraine are rising against the backdrop of delayed deliveries from South America

Heavy precipitation in March and April delayed the harvest of soybeans in Brazil and Argentina, which reduces the supply of oilseeds to the world market and supports prices in Ukraine.

According to the Conab agency, in Brazil, as of April 21, soybeans were harvested on 86.8% of 45.2 mln ha (89% last year on this date), as it rains in the southern states.

According to the Buenos Aires Grain Exchange BAGE, in Argentina, due to prolonged rainfall on April 17, soybeans threshed on 13.9% of the area, which is 22% lower than the average 5-year average.

May futures for soybeans on the Chicago stock exchange for the week rose by 1.9% to 429 $/t amid a delay in harvest, but remain 10% cheaper than last year.

Recall that in the first half of May 2023, soybean prices fell by 10% (which corresponds to the current level) amid the arrival on the world market of a record soybean crop from Brazil.

In Ukraine, the purchase prices for soybeans are rising amid increased competition between exporters and processors who need to secure stocks of raw materials for the new season, as well as restraining sales by farmers who expect the maximum price level.

Exporters have raised prices by 5-10 $/t and offer for soybeans with GMOs 410-415 $/t or 18600-18800 UAH/t, and for soybeans without GMOs – 425-430 $/t or 19000-19500 UAH/t with delivery to the ports of the black sea.

Processors this week raised the price of soybeans with GMOs by another 200-300 UAH/t to 17500-18000 UAH/t, and for soybeans without GMOs – by 300-500 UAH/t to 18500-19000 UAH/t with delivery to the plant.

Demand prices for non-GMO soybeans with delivery to Hungary remain at 450 €/t DAP, but queues at the border for 15 days make deliveries too expensive and economically unreasonable.

In 2023/24 MY, Ukraine exported (as of April 1) 2.5 mln tonnes of soybeans out of the forecasted 3.5 mln tonnes. During April, the company plans to ship about 250 thsd tonnes of soybeans, and in May – another 200-250 thsd tonnes. Currently, 1 mln tons of soybeans have been processed, and by the end of the season it will be possible to process another 500 thsd tonnes of the 4.8 mln tons of oilseed harvested this year.

The increased supply of soybeans from South America in May will reduce demand for Ukrainian soybeans, which will lead to lower purchase prices in Ukraine. However, the weather in June and the results of the planting campaign in the US may resume price growth.

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