AgriCensus Report

Brazil soybean exports slow as China demand, early harvest disappoints

Soybean exports out of Brazil in January will not reach 2 million mt, according to Agricensus calculations using export and line-up data.

Brazil exported just over 1 million mt of soybeans during the first two weeks in January with a further 800,000 mt in the line up data.

And while that will eclipse last year’s record of 1.5 million mt exported over the whole month, it does not reflect recent expectations that exports will be much higher due to an early harvest in Brazil’s southern states.

Sources say the trade war and the uncertain picture of Chinese demand has deterred buying of soybeans by private crushers, many of which have been impacted by negative crush margins.

Typically, Chinese crushers would buy US beans for January shipments to cover March crush, but with US imports taxed at 25%, US bean sales have been limited to state-sponsored purchases of 5 million mt, leaving a big question of what China will do for March supply.

“It depends how much of that (5 million mt) finds its ways to crushers,” said one soybean trader at an international trading house, adding that if much of it does trickle out then buying will remain muted.

Brazil remains the cheapest origin for Chinese crushers to buy beans, but trade has been “very quiet” for weeks, according to Brazilian and Chinese sources, with about 20 cargoes being bought since December.

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