May 31, 2019

Brazilian Soybean Prices follow U.S. Prices Higher

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

The commodity markets continue to be focused on the delayed planting of the corn and soybean crops in the United States. Record amounts of rainfall across the Midwest have kept planters out of the field in many locations. The result has been increased prices for corn, soybeans, and wheat.

The increased prices on the Chicago Board of Trade have translated into stronger prices in Brazil as well. On Wednesday of this week, prices being offered at Brazilian ports were in the range of R$ 85.00 to R$ 86.00 per sack (approximately $9.78 to $9.89 per bushel). There were not many sellers because they were asking for R$ 88.00 to R$ 90.00 per sack for August deliveries (approximately $10.00 to $10.35 per bushel). These conversions were calculated using an exchange rate of 3.95 Brazilian reals per dollar.

Premiums at Brazilian ports have also been on the rise as well. Premiums for soybeans at the Port of Paranagua are now in the range of $1.10 over the corresponding month in Chicago.

The prices in Chicago and in Brazil may continue to move higher if the planting delays in the U.S. persists into early June.

Earlier this week the 2019 U.S, corn crop was 58% planted compared to 90% last year and 90% for the 5-year average. Corn emergence was reported as 32% compared to 74% last year and 66% for the 5-year average. This is a record slow planting pace and what is unique about this year is that the delays stretch across the entire Corn Belt from Nebraska to Ohio.

The 2019 U.S. soybean crop was 29% planted earlier this week compared to 74% last year and 66% for the 5-year average. Soybean emergence was 11% compared to 44% last year and 35% for the 5-year average.

The corn planting window is quickly closing across the Corn Belt, but soybeans can be planted later and it remains to be seen if the weather will cooperate enough to allow farmers to plant their intended soybean acreage.