Brazil soybean planting delay to affect supply in January -AgRural
[CHICAGO] Rainfall scarcity expected in the coming days should further delay Brazil's soybean planting, affecting supply of the country's most prized agricultural export commodity in January, consulting firm AgRural said on Monday.
This bodes well for US soybean farmers, who compete directly with Brazil in exports and may continue to sell to top importer China throughout January, when a good portion of Brazil's crop is normally ready to be shipped.
Through Oct 1, Brazil producer planted only 1.6 per cent of the estimated soybean area, below a five-year average of 4.5 per cent for the country at this time of the season, according to AgRural data.
At the end of January, Brazil's biggest farm state Mato Grosso had already harvested 9 million tonnes of the oilseeds, or 25 per cent of the state's total crop.
"It is hard to imagine that even one-third of that will be harvested in January given the current scenario," said Fernando Muraro, AgRural analyst. "All of the action will take place in February." As soy supplies will not be available in January, port premiums relative to February 2021 shipping shot up by 25 per cent, reflecting strong demand for freight in the second month of the year instead of the first.
February 2021 port premiums reached a peak of US$1 per bushel using Chicago futures contract as a reference, Muraro noted.
GET BT IN YOUR INBOX DAILY
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Delays in soy plating also pose risks to cotton farmers who grow it after the soybean harvest, said Marco Antonio Santos, from the Rural Clima weather forecast firm. If dry weather persists, farmers may opt to plant corn instead of cotton after soy is harvested, he said.
"For those who plant cotton (after soy), the rain should have come at least 10 days ago," Mr Santos said.
REUTERS
KEYWORDS IN THIS ARTICLE
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Energy & Commodities
California to wrap up ExxonMobil plastics probe ‘in weeks’, AG says
Gold edges higher; hovers near one-week low on tempered Middle East fears
Why has gold’s inverse relationship with the US dollar reversed?
Oil futures fall as fears of a wider Middle East war fade
Malaysia’s Sapura Energy to sell stake in SapuraOMV to TotalEnergies for US$705 million
Saudi Aramco in talks to buy 10% of China’s Hengli Petrochemical