Planting acceleration and rains in Brazil are increasing pressure on soybean crops

Increased rainfall in central Brazil is boosting soybean planting, which has almost caught up with last year's pace, adding to pressure on stock prices.

 

According to AgRural data, as of October 24, 36% of the planned area was sown with soybeans in Brazil (20% a week ago, 40% last year), and warm weather with periodic rains predicted for the next 7-10 days will speed up work.

 

November soybean futures on the Chicago Stock Exchange rose 1.8% early last week, but then fell 2.5% to $357.9/t (-9% on the month), losing speculative weather-driven gains in Brazil

 

In the US, soybeans are 89% harvested on October 27 (5-year average of 78%), and thanks to dry weather, the harvest may be higher than forecast.

 

The pace of soybean exports from the USA remains at a 4-year high, although during October 18-24 exports decreased by 6% compared to the previous week to 2.39 million tons (of which 1.49 million tons were delivered to China), and in general in 2024/25 MR reached 10.406 million tons, which is 2.2% ahead of last year's pace.

 

In Ukraine, on October 24, 5.62 million tons of soybeans were threshed from 2.47 million hectares or 93% of the area with a yield of 2.27 tons/ha, so the harvest may become a record and exceed 6 million tons.

 

The increase in the supply of cheap soybeans from the USA on the world market collapsed the export demand for Ukrainian soybeans, so traders lowered the purchase prices for GMO soybeans to UAH 17,700-18,000/t or $370-375/t with delivery to Black Sea ports. Following them, processors reduced prices to UAH 18,000-18,200/t with delivery to the factory and increased the volume of purchases.

 

Export purchase prices for non-GMO soybeans in Black Sea ports also fell to $450-455/t or UAH 21,000-21,500/t, while processors lowered prices to UAH 21,500-21,800/t with delivery to the factory, and some stopped purchases altogether .

 

According to the USDA FAS forecast, in 2024/25 FY Brazil will increase soybean production by 6% compared to the previous season to a record 161 million tons, and its export - from 99 to 102 million tons. The increase in production is due to investments in the introduction of new technologies, in particular genetic - engineered seeds, chemicals and fertilizers.

 

Despite low soybean prices, Brazilian farmers continue to increase soybean production because it is easier to grow and more profitable than corn.