Brazil's Soybean Exports Accelerate after Slow Start

After a slow start, the pace of Brazil's soybean exports has surged in recent weeks. Total March exports, though 10 percent below last year, are quickly making up lost ground. The delay in shipping reflects the relative slow start in plantings and corresponding later harvest this year.

Producer sales, which were running behind last year, have caught up with historic norms. The lag in early season sales, while influenced by the later harvest, was likely impacted by the precipitous decline in the Real. The decline encouraged some producers to delay selling their crop until the currency stabilized in mid-March.

Despite the slow start, a record harvest is expected to lead to record local year (Feb/Jan) exports this year. However, exports for the adjusted Oct/Sep marketing year are forecast to decline slightly from last year. Weak exports for the first five months resulted in total exports through March running 3.6 million tons or 33 percent behind last year's pace. It is unlikely that exports for the remaining April through September period can offset this shortfall in trade.

OVERVIEW

Global soybean production is raised this month, as a larger crop in Argentina more than offset declines in India. Soybean trade is virtually unchanged. U.S. soybean oil imports were raised to offset declines in palm oil. The USDA Prospective Plantings Report indicated expanded area for 2015/16 as compared to the previous year. The season-average farm price for soybeans is lowered.

SOYBEAN PRICES

U.S. export bids, FOB Gulf, in March averaged $388 per ton, up $12 from the previous month.

As of the week ending March 26, 2014/15 U.S. soybean commitments (outstanding sales plus accumulated exports) to China totaled 29.9 million tons compared to 27.7 million a year ago. Total commitments to the world are 48.5 million tons, compared to 44.5 million for the same period last year.

2014/15 TRADE OUTLOOK