Soybean prices in Ukraine are actively growing following the global ones against the background of the weather in South America

Global soybean prices continue to rise on forecasts of a reduction in soybean production in South America due to a lack of precipitation, which led to a sharp rise in the price of soybeans in Ukraine.

The struggle between soybean exporters and processors in Ukraine is intensifying. The week before last, against the background of an increase in export prices for soybeans with GMOs in ports by 2 20-25/ton to 5 545-555/ton and a fall in the hryvnia exchange rate by 2-3%, exporters offered better prices, but last week they were forced to reduce them to UAH 17,300-17,600/ton after the hryvnia exchange rate strengthened by 2%.

Processors to attract the necessary volumes usually offer 300-500 UAH/ton higher than exporters (last year the premium reached 1000 UAH/ton), so last week they raised prices by 500-700 UAH/ton to 17700-17900 UAH / ton with delivery to the plant. Against the background of higher prices, manufacturers have stepped up sales.

Export prices for non-GMO soybeans remained at the level of 6 625-650/ton or 20500-21000 UAH/ton with delivery to the port or border and 20200-20500 UAH/ton with delivery to the factory. Processors are losing competition to exporters, as they are increasingly difficult to sell premium products without GMOs in European markets, where South America supplies cheap soybeans and soybean meal with GMOs.

March soybean futures on the Chicago Stock Exchange yesterday rose another 1.8% to 5 581/ton, adding 12.8% of the price in two weeks due to uncertainty with the soybean harvest in Brazil.

During January 29 – February 4, soybean exports from the United States decreased by 16% compared to the previous week to 1.218 million tons, and in general in the season reached 37.64 million tons, which is 30.8% lower than last year's pace, but already exceeds 2/3 of the USDA forecast for 2021/22 MG.

According to the agencies Safras and Mercados, as of February 4, soybeans in Brazil are harvested on 17% of the area, which is 17% higher than last year's pace, 7% - the average 5-year figure. In particular, in the state of Mato Grosso, 46% of the area is threshed, in Paraná-17%, which is 29% and 7%, respectively, higher than the average 5 – year rate.

Ahead of the release of the USDA report, analysts ' forecasts for the soybean harvest in South America vary greatly. It is expected that compared to the January report, the production forecast for Brazil will be reduced from 139 million tons to 1.5-12.5 million tons, for Argentina – from 46.5 million tons to 0.5-4 million tons.