Porto Alegre, August 14, 2023 – The pace of soybean trading for the 2022/23 Brazilian crop picked up strength in July and the first days of August, continuing the better movement registered in June.
Prices practiced in the physical market showed firmness in July, registering moments of appreciation that encouraged producers to move forward with sales of the current season. The rise of the spot position in Chicago along with the firmness of export premiums were the main vectors for the rise, although in the last sessions of July the first position registered an important negative correction in Chicago. As we move into the final months of the year, premiums are likely to show firmness in the face of lower soybean availability in an environment of record exports. Despite this, Brazilian stocks will be higher at the end of this season, which should limit the advance of premiums from October/November, holding prices down.
For the new crop (2023/24), prices remain under pressure for deliveries from February, which keeps producers withdrawn in terms of forward trading.
According to a survey carried out by SAFRAS & Mercado, with data collected up to August 4, 75.6% of Brazil’s 2022/23 soybean crop were sold, up 9.5% from the previous month (66. 1%). The current percentage is equivalent to approximately 118.105 mln tons, out of a crop currently estimated at 156.152 mln tons. In the same period of the previous year, the percentage was 79.9%, while the five-year average for the period is 83.8%.
For the new Brazilian soybean crop (2023/24), the data point to a theoretical percentage of sales of only 13.9% out of an expected record production of 163.254 mln tons, with an increase of 2.8% from the percentage registered in the previous month (11.1%). In the same period last year, the percentage was 17.3%. The five-year average for the period is 23.5%.
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