Brazil’s soybean exports lose steam on waning Chinese buying
Brazilian soybean exports dropped to 11.1 million mt in June, 13% lower on the year and 26% below volumes exported in...
Brazilian soybean exports dropped to 11.1 million mt in June, 13% lower on the year and 26% below volumes exported in May, as the country’s harvest ended and Chinese buying interest subsided, official customs data showed.
Cargoes bound to China represented 64% of total Brazilian bean exports in June, down from 68% in May and 71% in April, when the country registered record export volumes.
In 2020, China bought 70% of total Brazilian bean exports in June.
Besides the end of the peak season, “the main reason (behind falling exports) is China’s negative crush margins... (as well as) higher Chinese soybean, oil and meal stocks, lower crush rates, and declining hog prices,” Zairam Agrocommodities’s market intelligence analyst Victor Gusmão told Agricensus.
Due to these factors, Chinese buyers have been quiet during most of May and June.
On the second half of June, CBOT futures plummeted on somewhat improved weather forecasts in the US and plunging soyoil prices, reviving Chinese activity with cargoes snapped up out of the US Pacific Northwest ports, Brazil and Argentina.
However, bookings were for August or later loading months.
While the share of exports bound to China declined, the Middle East and North Africa regions and the EU increased their relative participation by three percentage points each and were responsible, together, for 18% of Brazil’s June bean exports.
June was also the second consecutive month of rare US purchases out of Brazil with 79,011 mt shipped, bringing total Brazilian bean exports to the US in 2021 to 177,662 mt.
In terms of origination, beans lifted from farms in Mato Grosso and Paraná reduced their share in total exports from 28% and 14% in May to 26% and 10%, respectively.
On the other hand, shipments of beans harvested in São Paulo, Espírito Santo, Bahia and Maranhão increased their joint share of exports by seven points on the month to 28%.
The share of exports leaving traditional southern and southeastern ports also declined by 4 points to 64% while northern arc and northeast ports gained market share.
Looking ahead, Brazilian exports are expected to continue edging down as the country is off-season with 7.6 million mt schedule to leave ports in July as of July 5, according to line-up data from shipping agency Cargonave.
Brazil exported negligible volumes of corn in June while imports rose 87% on the month to 106,732 mt, compared to less than 5,000 mt year-ago.
Volumes came from Argentina and Paraguay and were practically entirely bound to the southern states of Rio Grande do Sul, Santa Catarina and Paraná.