Homeless soybeans ?: Topped $ 400 in Chicago, peaked in 4 years

Soybeans increased by $ 10 a tonne in the Chicago market and the price has returned to the heights of 4 years ago: it reaches around 406 U $ S / t on this world reference market and in Rosario, the main Argentinian square, it is sold at 26,120 U $ S / t.

This is the third day in a row that oilseeds have shown increases, following sustained increases since the mid-years, which had slowed a week ago.

The structural causes of the increase are linked to the drought affecting South America in the current agricultural season. Consolidation of forecasts for Year Girl, operator discount significant yield losses in Brazil (the world’s largest producer) and also in Argentina (which occupies third place in the ranking, after the United States).

On the renewed concerns about the development of the campaign in Brazil and, to a lesser extent, Argentina, Eugenio Irazuegui, head of research at the cereal broker Zeni deemed relevant that “the weather forecast is reducing accumulated precipitation for the next two weeks. It shows below-normal records, both in north-central Mato Grosso and in the southern states of Brazil.

There is also strong demand from the world’s largest importer, China.. “China’s return to the US soybean market and the intense schedule of future shipments bode well for the promises set out in the Phase 1 trade agreement between the two countries. This agreement suggests that China will buy and import at least 36.5 billion US dollars in US agricultural products in 2020, a historic record, ”the operator said. Fernando Perosio, operator of Cóndores SA.

“The weather, strong Chinese export demand and the weak dollar are supporting Thursday’s gains,” he said. Esteban Moscariello, Commercial Director and Analyst at Díaz Riganti Cereales. He added, “Many analysts believe Chinese soybean demand will be higher than market forecast. The combination of these factors helps to keep soybean values ​​high, especially in contracts concluded. “

A question in the market now is how much soy does China need commit to the United States before harvest begins in South America. In this regard, Moscariello takes into account that “the United States Department of Agriculture (USDA for its acronym in English) has stated that soybean export sales amounted to 1,531 million tonnes. . The market had estimated between 800,000 and 1.7 million tonnes. As of October 29, the United States’ external soybean commitments were 48.5 million tonnes, 81% of the total estimated by the USDA, of which 55.3% went to China ”.

Moscariello also pointed out that “the market is also discussing the amount of soybeans imported from China next year. The USDA has published that China will import 100 million tonnes of soybeans. However, the USDA report on China estimated less, as it projects 95 million tonnes. “

Price and how much reaches the pocket of the Argentine producer

As part of the general increases, soybean oil jumped US $ 15 per tonne for the most immediate position, up to US $ 773.10. “India has acquired shipments for 33,000 tonnes of soybean oil, an atypical operation as it generally sources from South America,” Irazuegui explained. Corn and wheat prices accompanied the upward trend. Maize rose nearly $ 4 to US $ 163 / tonne (December position), due to strong external demand for North American grains. The price of wheat, meanwhile, rose by more than $ 6 per tonne, to US $ 229.2 in December, nearly 30% higher than at the end of June, in a cycle driven by technical purchases, such as report it Rosario Stock Exchange.

Today, Argentine producers charge 26,120 pesos per tonne of Soy, because the Chicago price is reduced due to withholding taxes and later because the grain is settled at the official National Bank exchange rate, resulting in Argentine farmers receive “a dollar at 64 pesos” in exchange for soybeans.