06-08-2016

Brazil’s grain exports to fall by half in August

grain

Brazilian soybean, meal and corn exports are expected to fall to half the level seen last year in August, according to shipping line-ups at the ports, as merchants focus on selling corn on the local market and soy loses its competitive edge abroad. August exports of soy, meal and corn from Brazilian ports in August are forecast at 4.87 million tonnes, down sharply from the 9.37 million tonnes shipped in the same month of 2015, according to Williams data compiled by Reuters.

Soybeans and corn account for the bulk of the export volume. At this time of year, corn exports are normally in ascendance with the soy crop long finished. But losses in the winter corn areas due to irregular rains in the center-west took the wind out of exports of the grain. “It’s very likely that Brazil won’t get close to the level the government crop supply agency Conab projected” in corn exports, grains analyst Andrea de Sousa Cordeiro at brokerage house Labhoro said.

Conab forecast exports of 22 million tonnes, still well down from the record 30.2 million tonnes exported in the previous year. Brazil exported 7.6 million tonnes of corn from January through June, according to private-sector data. But prices on the domestic market, which have been stubbornly at more than twice levels seen last year at this time, have many trading companies redirecting cargoes once destined for export to local pork and poultry industries.

Cordeiro said part of what had been sold by grain merchants for export out of Brazil was now being supplied to buyers in Asia from other origins such as the United States. “Several multinational merchants were shifting their export positions and selling corn on the internal market,” Marques said.

Source: Reuters

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