The Brazilian market seems to have ignored the planting dates and crop cycles to carry out the future delivery of contracts of the second crop. There is some panic about regional supply with a falling availability of stocks for consumers, regional harvest still slow, and forward contracts delaying for both the domestic and export markets. This scenario sustains prices even in the resumption of highs in some locations and strong premiums at ports. In view of a second crop with good production profile and with international prices under pressure, is this Brazilian scenario sustainable? Well, first of all, we reach the phase of the flow of weekly shipments, which will bring us to reality in the projections for the year. Then, the decisions of producers. The higher the retention, the lower the chance of highs for the end of the year due to the transition of stocks and cut in exports. Internal demand is already considered and will not change the overall picture.
The harvest of the Brazilian second crop is advancing. Slightly faster in Mato Grosso to meet forward contracts and ensure logistics and space in dryers. The flow, therefore, is already equalized with shipments in Santarém, Belém, and São Luís. There is the flow to Santos, which will concentrate the largest share of shipments for the month of July, with 1.8 million tons of a total schedule of 3.8 million tons in the country.
PUT GRAF LINEUP
This volume of scheduled shipments for July, which can still improve, contrasts with the terrible June, with shipments that must not exceed 500 thousand tons. We cannot make a fake assessment of the export flow. 4 million tons per month until January will mean an annual volume of only 30 million tons. Therefore, to overcome this annual number, we will need more in monthly volumes. Between July and September, it seems normal that shipments are good and really within the target of 4 to 5 million tons. However, we will also need an excellent flow between October and January. New business has not quite surpassed the month of October, and we have not seen trades for December and January, which is really worrying.