“This withdrawal of profits from speculators took place even despite the high degree of skepticism that persists as to seeing concrete results of the dialogue between Ukraine and Russia in the short term. Meanwhile, the new drop in oil, the progress of the harvest in South America and the news coming from China, with outbreaks of Covid and negative margins for pig producers that put them in search of alternative foods to flour cheaper soybeans, contributed to the downward trend”, they detailed from the Granar brokerage.
The truth is that despite the fact that soybeans accumulate their second consecutive drop this week, they still remain in the attractive area of $600 per ton. Although new geopolitical scenarios are consolidated, in the agribusiness sector they expect a drop in prices in the medium term.
Days ago, the Rosario Stock Exchange indicated that due to the rise in prices, shipments from the soybean complex were projected at US$23,168 million, US$2,640 million more than expected a month ago. In other words, if the declines in the international market continue, the national coffers could lose at least some US$2.6 billion from shipments of the oilseed.
Cereals in the spotlight
In as much, another key question is opened with respect to the cereals (corn and wheat). The rise in the international prices of both products also hit the price of food in the domestic market squarely, and for this reason the Government sought to create a compensation fund for wheat prices. In other words, a drop in international prices can be analyzed in two ways. On the one hand, it would represent a lower income of foreign currency – but within historical maximums – and on the other hand, less pressure for the internal market since corn has a great impact on the costs of animal feed (fundamentally beef, pork and poultry) and wheat in the production of bread and noodles, among many other products of the basic basket.
With these considerations, the corn it fell almost 3% ($8.76 per tonne) to finish the wheel at $285.91. “What remains at stake for the purposes of the agricultural market is the full revival of exports from the Black Sea area and the 2022/2023 planting campaign, which in Ukraine should start in the first days of April. Last week the Ukrainian Ministry of Agriculture indicated that corn planting could range from 3 to 3.3 million hectares, compared to 5.4 million in 2021. A ceasefire could improve that forecast. The good prospects for the second corn harvest in Brazil added to the downward trend”, they advanced from Granar.
Regarding the income of foreign currency from this sector, with its maximum prices, the projections days ago indicated shipments for US$8,651 million, and current prices continue at historical highs, so the drop in income would be just a few US$ s800 million.
Finally, wheat was the one that had the most complicated day in Chicago. During the round it lost more than US$27 per ton but then managed to adjust and end up down around 4% (US$15.71) to close the day at US$372.67. Meanwhile, the income of dollars foreseen for the cereal continues around US$4,400 million. The difference is that days ago the government authorized an additional export quota of 8 million tons of wheat 2022/23 – which will begin to be harvested next December – to add a total of 10 million authorized, the objective is to capture the high prices while last.
In conclusion, with the current values, the field would contribute no less than US$38,000 million this year, although not everything has been said. The lack of rainfall could complicate the next campaign and the volatility in the international markets continues to be the order of the day.
Source: Ambito
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