Nov 20, 2014

Soy Forward Sales Increasing in Mato Grosso still Lag Last Year

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

Farmers in Mato Grosso have taken advantage of improved soybean prices to increase the forward contracting of the 2014/15 soybean crop. According the latest assessment from the Mato Grosso Institute of Agricultural Economics (Imea), farmers in the state have now sold 25% of their anticipated 2014/15 soybean production. While this is an improvement over recent weeks, it is still considerably less than the 44% that had been sold last year at this time.

The amount of forward sales of soybeans varies by region in the state with the northeast region at 33% sold, southeast at 25%, west at 25%, central at 23%, northwest at 22%, and northern region at 16% sold.

Until recently, Brazilian farmers had been reluctant to sell their soybeans due to low prices, but the combination of improved prices at the Chicago Board of Trade and a weaker Brazilian currency has resulted in improved prices in Brazil. The price of soybeans in Mato Grosso increased 2.6% last week to an average of R$ 56.27 per sack (US$ 10.23 per bushel using an exchange rate of 2.5 reals per dollar.

Approximately 85% of the 2014/15 soybean crop had been planted as of late last week which is 9% less than last year.