Rain in Brazil puts pressure on soybean prices

Rain in Brazil puts pressure on soybean prices
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The price index of the IGC, a measure of the price of soybeans in the world, fell slightly to 303 points on Monday, February 6 (year 2000 = index 100).

Price fluctuations have not been as strong in recent weeks. Compared to a year ago, the price index is 3% lower.

Harvest is delayed

The harvest has started in Brazil, but it is delayed due to rainfall. This is currently supporting the soybean price, as Brazil is the largest producer and exporter of soybeans in the world. Analysts from the Brazilian market agency AgRural estimate that 9% of the area is harvested, compared to an average of 16% in the same period.

Soy exports from Argentina sluggish

The soybean price is also supported by the drought in Argentina. It has been very dry there for a long time. Also for the coming week, weather forecasts in most Argentine regions indicate mainly drought. The export of soybeans from Argentina is somewhat sluggish due to the tight supply, and as a result less soy is shipped.

Market awaits Brazilian record harvest

In the short term, the soybean price is not as volatile. Price pressure is expected for the longer term. Namely when the Brazilian record harvest comes on the market. Nevertheless, there are concerns about the harvest in the southern provinces of Brazil, because it is very dry there and the harvest will therefore be lower than in previous years.

Worries after balloon affair

Concerns have also arisen about diplomatic relations between the United States and China as a result of the so-called balloon affair. The demand for soybeans from China remains important in the oilseeds market. And this afternoon, the next Wasde report will be released in which new production forecasts for soybean crops will be issued. The market is currently waiting for a clear price direction to be chosen.

Annet Smale Editor Feed Markets
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