Dec 24, 2020

Strike at Argentine Ports Worry Brazilian Wheat Millers

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

The prolonged strike by port workers in Argentina is worrisome for Brazilian wheat millers especially if the work stoppage isn't resolved by the end of the year. Currently, there are 22 ports in Argentina have been paralyzed by the strike of over two weeks and as a result, there are more than 100 vessels waiting to load soybean meal, soybeans, corn, and wheat.

Brazil needs to import approximately half of its wheat needs and its principal supplier is Argentina. The Brazilian wheat harvest has just concluded so millers are in the process of using Brazilian wheat, but if the strike drags on into early January, some Brazilian wheat millers could run out of wheat.

During the first three weeks of December, Brazil imported 200,000 tons of wheat from all sources compared to 650,000 tons for the month of December 2019.

From January through November of 2020, Brazil imported 5.87 million tons of wheat with 4.33 million tons from Argentina (73.7% of the total), 733,800 tons from the U.S. (12.5% of the total), 237,600 tons from Russia (4% of the total), 235,000 from Uruguay (4% of the total), and 218,500 tons from Paraguay and others (3.7% of the total).

Argentine farmers who just finished harvesting their wheat are not allowed to enter the ports to deliver their wheat due to the strike, but if the strike ends by January 1st, wheat millers in Brazil should be restocked in time to continue operations.