November 25, 2014
Soy prices swing high and low in Brazil, international markets
Soyand its by-products had varying scenarios of low and abundant supplies, triggering a relentless oscillation in their quotes both in Brazil''s domestic market and the international market during the second week of November.
Quotes went up as demand shot up against a scenario of low supply in the domestic market, on one hand, and, on the other, prices dropped due to projections from the US Department of Agriculture of a record global supply of up to 312 million tonnes in the 2014/15 season.
In Brazil, trades in the spot market and anticipated contracts were closed as demand from chicken farms, industries and beer-producing companies was up in mid-November. Brazil''s Cepea [Center for Advanced Studies on Applied Economics] estimated that, from the 2013/14 crop, only 7% was left to trade, and, from the 2014/15 season, only 15% to 20%.
The pace of planting in several Brazilian regions was reportedly delayed. For example in the state of Paraná, according to Deral/Seab [Office of the State Secretary of Agriculture], only 75% of the area had been planted as of the third week of November. In Mato Grosso, 84.1% of the area had been planted as of Nov. 13, against 93% in the same period last year.
However, the USDA estimates that Brazilian soy production will reach 94 million tonnes in the 2014/15 season, which is even higher than the 90.54-million-tonne estimate of Conab, a public company under the Brazilian Ministry of Agriculture.