Market sources explained to Ámbito that forward contracts are at the lowest level in the last 10 years. The price effect, problems in implementing the blend dollar and the counterproductive promise of Luis Caputo and Javier Milei.
Soybean marketing is at a historic low. Market sources explained to Ámbito that forward contracts are at the lowest level in the last 10 years. The sustained decline in international prices and problems in implementing the “blend dollar” are having a negative impact, but at the same time exporters warn that the Government’s promise to release the stocks in the middle of the year also delays operations. They anticipate a liquidation of the thick harvest “drops and down”
For weeks it has been clear that what had been classified as a “record harvest” will not have those characteristics. The estimates of The Rosario Stock Exchange warns of a cut of 2.5 million tons due to the heat wave that had a strong impact on the productive sectors despite the rains that fell between February 7 and 14.
Furthermore, according to the same entity, due to the drop in international prices, in just two months the value of Argentine agricultural production lost about US$4.7 billion compared to previous estimates. In soybeans the fall will represent about US$2,344 million less and in corn US$1,483 million. There are also less significant declines in wheat, sunflower and barley.
At the same time, the persistent decline in international soybean prices also brought a contraction in sales: “soybeans are going down, they don’t stop going down, the producer when he sees that trend generally refuses to sell because he always believes that its production can be worth more,” summarized an experienced businessman in the sector in dialogue with Ámbito.
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Sales are delayed while waiting for the stocks to be released
With this scenario, the recent promise of the Minister of Economy, Luis Caputo, and President Javier Milei to release the stocks for the second half of the year is celebrated by local producers, who believe they could receive a more attractive exchange rate. For this reason, they choose to delay their sales as long as possible. Thus, “forward contracts are at the lowest level in the last 10 years,” they explained from the export sector.
Nobody can complain, the incentives are there. Added to the drop in prices and the Government’s counterproductive promise was the difficulty in setting contracts using the contributions from the “dollar blend” scheme. A fact that was partially corrected with an agreement between BCR and Matba Rofex to facilitate the formation of prices for future operations.
However, in the export sector, the data from sworn declarations of foreign sales are closely monitored, which show a noticeable drop in each of the segments in the year-on-year comparison. And they warn that until the stocks are opened, the liquidation of the coarse harvest will be “drop and drop.”
Source: Ambito
