July 21, 2024

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Up to 8 million tons of soybeans sank in Brazil – analysis of grains and raw materials

Up to 8 million tons of soybeans sank in Brazil – analysis of grains and raw materials

Stock struggle

analysis Grains and raw materials

Yesterday at 12:25 pm – Jorvas Lugtenburg

In Holland we had to deal with local flooding last night and last night. This doesn’t exactly cause panic for players in the grain market. The situation is different with the harsh weather sweeping southern Brazil. Entire plots of soybeans are underwater there. According to Ames, the conditions for growing grains in the Netherlands and Germany are not unfavorable. The new crop monitor therefore contradicts observations received from the field.

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The May wheat contract on Matif closed yesterday €0.25 lower at €204.75 per tonne. Grain prices were rising at the Central Bank of China. The price of wheat rose by 0.9% to reach $5.85 per bushel. The price of corn rose 2% to $4.52 per bushel. Soybeans were the biggest gainer on the Chicago Stock Exchange, closing up 3% at $11.90 a bushel.

In the Netherlands we have to deal with local floods. This pales in comparison to the amount of rain that fell in the far south of Brazil. Rio Grando do Sul Province has been witnessing continuous heavy rains for several days. Yesterday, a dam collapsed under heavy rain. The floods claimed the lives of 30 people and left 60 others missing. The BBC reported that 15,000 people had to leave their homes due to rising waters and that 500,000 people no longer had electricity and clean water.

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Source: NOAA

Necessity knows no law
In addition to the human suffering, agriculture in Rio Grando do Sul has been severely affected by the floods. Estimates vary, but between 4 and 8 million tons of soybeans could still be harvested in the now underwater area. The USDA estimated Brazil’s soy crop at 155 million tons in a recent Wasde report. Conab kept its forecast at 146.5 million tons. Now, not all of the soybeans still standing will likely have sunk, but there will likely be a significant correction to the yield outlook. It’s no coincidence that soybeans made the jump on the CBoT. Meanwhile, farmers are doing everything they can to get their crops in one way or another. “Save what can be saved of the approximately 30% of soybeans that still need threshing” is the gist of the message below.

Ames has deployed a new crop monitor. What is even more striking is that Benelux and Germany are colored green with a corresponding week for grains. This is not consistent with reports of relatively persistent and intense wet conditions in northwestern Europe. For example, the Scientific Office of the European Commission and the German Cooperative Association warned last month of disappointing grain yields due to unfavorable growing conditions.