Forward sales of soybeans from Brazil are significantly lower than last year, indicating a drop in global demand

Much lower than last year, the volumes of forward sales of soybeans from Brazil indicate a reduction in global demand due to a decrease in imports by China. In addition, importers are restraining purchases in anticipation of a seasonal drop in soybean prices from South America, and producers have limited sales in the hope of rising prices, although they remain at a fairly high level.

According to the Safras&Mercado agency, forward sales of Brazilian soybeans amounted to 46.72 million tons or 30.5% of the expected production of 153.3 million tons, while at this time last year they reached 44.1%, and on average for 5 years - 44.8%.

AgRural reports that long rains are delaying the soybean harvest, and Brazilian farmers have so far threshed more than 14 million tonnes of beans from 9% of the area, compared to 16% of the crop by this date last year. The late soybean harvest will delay second-crop corn planting, so some crops may be affected by the May drought at pollination. According to the agency, only 12% of the area is sown with corn, compared to 24% at this date last year. However, if the weather conditions improve, farmers will be able to intensify sowing, so there are no significant concerns about the future harvest.

Today, the USDA will release a new supply-demand balance sheet, which analysts expect will lower Argentina's soybean crop forecast by 3.5-9 million tons (optimistic and pessimistic estimates), compared to the 45.5 million tons the USDA estimated in January, and in the previous season, the harvest amounted to 42.9 million tons.

Forecasts of rain this week dampen speculative demand for soybeans on the Chicago Stock Exchange, so quotes fell to $565/t, in line with last week's level.