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Brazil could import up to 1.0 million tons of US soybeans
Oct. 1, 2018
Due to the tremendous demand from China, Brazil has been exporting soybeans at a break-neck pace leading to speculation that they would need to import soybeans in order to avoid running out before the new crop starts to become available in January.
Reuters reported that the president of AgriBrasil is estimating that Brazil will need to import approximately 1.25 million tons of soybeans in late 2018 and early 2019 with 1.0 million tons coming from the United States and another 250,000 tons from Paraguay.
In their September Crop Report, Conab warned that Brazil's 2018 soybean carryover stocks could fall to 434,000 tons, which would be less than the prior minimum of 448,000 tons set in 2012. The Brazilian Grain Exporters Association (Anec) has been commenting for several weeks on the potential need to import soybeans from the United States.
China has purchased very few soybeans from the United States since the onset of the trade dispute between the two countries. As a result, more than 80% of Brazil's soybean exports in 2018 have gone to China. There are very high premiums for soybeans at Brazilian ports resulting in strong domestic soybean prices. In contrast, domestic soybean prices in the United States are near 10-year lows.
Margins for soybean crushers in Brazil are very tight if not negative, whereas crushers in the United States are reporting very good margins.
Source: Soybeans&Corn Advisor
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