The good news is that the international price of the oilseed and its derivatives rose 15.6% in the Chicago market since the beginning of January, to settle at around US$570 per ton, from US$493.85, largely driven by the drought in Argentina and Brazil. Meanwhile, the price of flour rose from US$467.26 a ton to US$489.31 on Friday, and in the case of oil, it grew from US$1,239 a ton to US$1,440.92.
At the local level, the available merchandise traded throughout the week above US$400 per ton on the Rosario Stock Exchange (BCR), a value that was unthinkable long ago for the market that projected a sharp drop in prices.
In this framework, from FIDE they project: “Our scenario indicates that the greatest loss of yields will occur in early corn and soybeans in the northern core zone. We believe that the good numbers for wheat and the sustained price levels of soybean meal and oil will offset the loss in corn yields. We expect foreign exchange earnings from the agricultural sector to remain at the values of 2021. This is positive considering that it was a record year.”
For its part, with an optimistic look from the economic consultant, they risk: “Although new rains are expected to achieve an improvement in different regions of the country that allow cushioning the greatest climatic impacts of recent months, the pessimistic scenario of drought is abandoned. We project that the levels of agricultural exports will remain at last year’s values. The one that has just ended, and even with a drought, was a record year for agricultural exports; therefore, prospects remain good. And although the dynamics of each crop will be different, the favorable aggregate result is due to the improvement in the quantities of wheat and the prices of soybeans and their derivatives will be able to compensate for the loss of yields. We remain expectant, meanwhile, regarding the impact of the Fed’s new policy on the prices of primary products. The base scenario incorporates a drop effect in grain prices of around 10% end-to-end for each harvest period”.
Meanwhile, the head of the Market Analysis Department of the Grassi brokerage, Ariel Tejera, indicated that “in the short term, the evolution of prices remains tied to the evolution of the climate in South America and the volume of production that, effectively , manage to contribute Argentina, Brazil and Paraguay”.
“The markets have already been incorporating production losses, but the final numbers are not yet closed,” he said.
In the medium term, Tejera considered that in this month “new factors linked to the United States begin to be added”, such as the sowing prospects, the corn/soybean bid by surface and the forecasts for the start of work.
“All this will begin to gain prominence soon. Even more so, considering the lower supply that is already calculated from South America and the possibility that the sale of demand over the United States will be extended, being able to limit the final stocks with which the northern country will close the campaign,” he concluded.
Source: Ambito
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