Jun 06, 2014
Soybeans Surpass Iron Ore as Main Brazil Export thus far in 2014
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
During the first five months of 2014, soybeans surpassed iron ore as the principal export from Brazil. According to the Agriculture and Livestock Confederation of Brazil (CAN), data from the Minister of Industrial Development and Exports (MDIC) indicates that during the first five months of the year, soybeans accounted for 13.9% of Brazil's exports while iron ore accounted for 13%. China is the main destination for both of Brazil's main exports – soybeans and iron ore.
Strong demand for soybeans from China and tight supplies in the U.S. has led to continued strong soybean exports from Brazil. The average price for the soybeans during the period fell 4.8%, but the volume increased 28% resulting in total receipts increasing 22%. Improvements in port operations and expanded port capacity have resulted in fewer delays at Brazilian ports and increased export volumes.
Exports of soybeans, soybean meal, and soybean oil from Brazil have steadily been increasing since the 1990's, but the export pace accelerated during the 2000's with increased demand from China. During the first five months of 2014, exports of soybeans, soybean meal, and soybean oil totaled US$ 15.53 billion or 17% of Brazil's total exports.
In addition to the soybeans and soybean meal, three other agricultural products registered big increases in exports during the period including: leather and skins (+24%), beef (+14%), and cellulose (+7%). These five products accounted for US$ 20.77 billion or 23% of Brazil's total exports during the period. CAN also indicated that there has been an increase of 46% in live cattle exports as well during the period.
In contrast to soybeans, corn exports registered a decline during the first five months of 2014. Corn exports during the period fell 35% with the average price declining 29% resulting in total receipts from corn exports falling 54%.
The receipts from Brazil's sugar exports have declined 23% thus far in 2014 as a result of depressed sugar prices. Brazil accounts for 50% of the world's sugar exports and excess sugar supplies during the last four years have pressured sugar prices. Brazil's exports of sugar to the European Union, Africa, and the Middle East have decline in recent years while exports of sugar to China have increased.