by Roberto Samora
SAO PAULO (Reuters) – The anticipated sale of soybeans from the 2022/23 crop in Brazil reached 18.6% of the estimated harvest until this Friday, with a delay compared to the historical average for this season, due to the fact that producers are retracted in business, pointed out this Friday the consultancy Safras & Mercado.
In the same period last year, the anticipated sale of the new crop was 25.6%, while the average for the period is 25.9%.
In comparison with the beginning of August, the negotiation advanced little. Until the 5th of last month, the number was 17.3%.
“As futures prices for 22/23 are lower, margins are tighter, and the producer doesn’t like that, this is the main reason for the delay”, explained Safras analyst Luiz Fernando Roque.
“It has a higher cost and a lower future price than the current one, which makes the producer withdraw”, he added.
The consultant also recalled that the producer, in general, is well capitalized, with the exception of farmers in Paraná and Rio Grande do Sul, where there was a strong crop failure last season.
“Producers who sold the crop well have less need to anticipate sales, but always remembering that this is a risk”, he highlighted, noting that the United States is on the way to harvest a large crop in 2022, Brazil is expanding the planted area, while there are prospects for good harvests in Argentina and Paraguay as well.
Planting in Brazil should start in the middle of this month.
He recalled that, in the beginning, commercialization was slower due to the difficulty of producers to perform “barter”, the exchange of inputs for future crops. “There is no more, there is a normalization of input deliveries, that risk of lack of input did not materialize”.
On the other hand, the president of the Brazilian Association of Vegetable Oil Industries (Abiove), André Nassar, said earlier this week that the sector is cautious to close future deals, due to uncertainties related to raw material prices and processing margins, that possibly wouldn’t be as good as they were in early 2022.
OLD HARVEST
The sale of the country’s old soybean crop (2021/22) reached 82.6% of projected production, compared to 79.9% in the August report.
In the same period of 2021, the negotiation of the harvest carried out in the first semester involved 85.9% and the five-year average for the period is 87.8%.
According to the analyst, the producer is betting on firm prices for the old crop, on account of sustained premiums, after the soybean crop failure in Brazil. “It makes a little more sense to hold on to 2022 than it does to 2023.”
(By Roberto Samora)
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