Soybean prices in Ukraine are rising against the backdrop of delayed deliveries from South America

Heavy rains in March and April delay the harvesting of soybeans in Brazil and Argentina, which reduces oilseed supplies to the world market and supports prices in Ukraine.

According to the agency Conab, in Brazil as of April 21 soybeans were harvested on 86.8% of 45.2 million hectares of land (89% last year on this date), as rains are falling in the southern states.

According to the data of the Grain Exchange of Buenos Aires BAGE, in Argentina, as a result of long rains on April 17, soybeans were threshed on 13.9% of the area, which is 22% less than the 5-year average.

May soybean futures on the Chicago Mercantile Exchange rose 1.9% to $429/t for the week amid a delay in harvesting, but remained 10% cheaper than last year.

We will remind that in the first half of May 2023, soybean prices fell by 10% (which corresponds to the current level) against the background of the arrival of a record soybean crop from Brazil on the world market.

In Ukraine, purchase prices for soybeans are rising against the background of increased competition between exporters and processors who need to ensure supplies of raw materials for the new season, as well as curbing sales by farmers who expect the maximum level of prices.

Exporters have raised prices by $5-10/t and offer $410-415/t or UAH 18,600-18,800/t for soy with GMOs, and $425-430/t or UAH 19,000-19,500/t for non-GMO soybeans delivery to Black Sea ports.

Processors this week raised the prices of soybeans with GMOs by another 200-300 UAH/t to 17,500-18,000 UAH/t, and for soybeans without GMOs - by 300-500 UAH/t to 18,500-19,000 UAH/t with delivery to the factory.

Demand prices for non-GMO soybeans delivered to Hungary remain at €450/t DAP, but queues at the border of 15 days make deliveries too expensive and economically unfeasible.

In 2023/24 MR, Ukraine exported (as of April 1) 2.5 million tons of soybeans out of the forecasted 3.5 million tons. During April, it is planned to ship about 250,000 tons of soybeans, and in May - another 200-250,000 tons. So far, it has already been processed 1 million tons of soybeans, and by the end of the season it will be possible to process another 500,000 tons of the 4.8 million tons of oilseed collected this year.

The activation of soybean supplies from South America in May will reduce the demand for Ukrainian soybeans, which will lead to a decrease in purchase prices in Ukraine. However, the weather in June and the results of the sowing campaign in the US may resume price growth.