Mar 19, 2020

Brazil Exporters Confident Virus will Not Impact Total Shipments

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

The director of the Brazilian National Association of Cereal Exporters (Anec) indicated that they continue to feel that Brazil will export 73 to 74 million tons of soybeans in 2020 Additionally, Anec feels that Brazil will export 34 to 35 million tons of corn in 2020.

Since the vast majority of Brazil's soybean exports are destined for China, these estimates will depend if the ports in Brazil and China can remain open during the coronavirus pandemic. Union workers at the Port of Santos in southeastern Brazil, which is Brazil's largest port, asked on Wednesday for a suspension of work during the crisis, but as of this writing, the port is still functioning normally.

Traders indicated that the Chinese purchased 35 vessels of Brazilian soybeans last week including August shipments. The vessel lineup at Brazilian ports until mid-April is 40% larger than a year ago. The lineup represents 24.9 million tons of soybeans. There are 14 million tons of soybeans waiting to be shipped out of Brazilian ports and Brazil is expected to export 8.5 to 9.0 million tons of soybeans during March.

Brazilian farmers have been very aggressive sellers of their crops due to record high domestic prices resulting from the devaluation of the Brazilian real against the U.S. dollar. The Brazilian real is currently trading at about 5.2 reals per dollar. Brazilian farmers have sold 70% of their 2019/20 soybean crop and approximately 15% of their 2020/21 soybean crop.