Commodity Shuttle: With crop failure, soy revenues participate less in the agro balance

Soybeans, the flagship of Brazilian agribusiness exports, will not have a scenario as favorable as initially expected.

In January, revenues from exports of the soy complex (grains, meal and soy oil) were estimated at US$ 56.3 billion, says Abiove (Brazilian Association of Vegetable Oil Industries).

This Monday (28), the association revised its figures to US$ 51.4 billion, due to the fall in the soybean harvest and the consequent reduction in the volume of exports.

Initially, up to 145 million tons were expected, but this year’s crop should be 125.3 million, according to the entity.

Conab, a government agency, and some private consultancies, such as AgRural, already estimate the national harvest at a volume of less than 123 million tons.

With a lower supply of soybeans, Abiove revised its export forecasts. Estimated at 91.1 million tons at the beginning of January, foreign sales should fall to 77.7 million this year, according to a new estimate.

Even with a lower volume of exported soybeans, revenues will still be higher than in 2021, when the country raised US$ 48 billion. This increase is due to higher prices this year. Last year, exports reached US$ 449 per ton. This year, they should be US$ 530, according to the entity’s forecasts.

Changes in the soybean meal and oil sectors will be small, as volumes and prices this year will not vary much from last year.

The performance of the soy complex inhibits the evolution of agribusiness exports, which totaled US$ 120 billion in 2021. However, they may be partially offset by corn.

The Brazilian off-season promises to be good, and cereal prices are heated on the foreign market. Ukraine, the world’s fourth largest corn exporter, will have production and exports affected by the war with Russia.

Last year, due to the failure of the second corn crop in Brazil, exports, initially estimated at 44 million tons, were only 20.4 million and generated US$ 4.2 billion. In 2019, there were 43 million tons, with revenues of US$ 7.3 billion, according to data from Secex (Secretariat of Foreign Trade).

The soy complex has been the engine of Brazilian agribusiness exports. If Abiove’s data for this year are confirmed at US$ 51.4 billion, the country will reach the mark of US$ 355 billion in revenues in the last ten years.

Even with the reduction in the national harvest, Abiove maintains the expectation of crushing 48 million tons of soybeans internally this year, 0.5% more than in 2021.

With this practically stable level of soybean crushing, production and exports of bran and oil will have little variation compared to 2021.

Soybean oil, which makes up at least 70% of the raw materials used in the production of biodiesel, will have lower domestic demand this year due to the reduced blending of this fuel with diesel.

dodging inflation

Last year was a very difficult period for cattle feeders. Arroba prices were at record levels, but costs also rose.

“It was difficult to turn inflation into earnings.” This is how the researcher at Cepea (Center for Advanced Studies in Applied Economics) Thiago Bernardino de Carvalho evaluates the sector in 2021. Despite the problems, the return on investments increased by 6.65%, a rate, however, far from the 23.83% from 2020.

These numbers are based on a monitoring program for the sector carried out by Cepea and DSM/Tortuga, a company focused on animal nutritional supplementation. For this year, the sector’s profitability should be 13.37%, with a yield of 4.1% in the months in which cattle are confined. For the researcher, the gains are associated with the use of technology, management and, of course, the continuity of Chinese appetite.

tropical wheat A plan by Embrapa and the wheat production chain to increase the planting of cereal by 100,000 hectares in a tropical region was approved by the Ministry of Agriculture. The funds will total US$ 2.9 million to be applied over three years.

tropical wheat 2 Embrapa participates by transferring technology to producers and characterizing the municipalities that will be included in the production. In addition, the company will dedicate itself to the fight against blast, the main disease of cereal crops in the region.

seeds One of the group’s tasks is to organize seed production, installing new multiplication fields. A methodological refinement will also be necessary for a more accurate definition of agricultural zoning, in order to avoid risks in production.

RollThe rise in wheat, due to the war in Russia and Ukraine, reached flour and its derivatives. Fipe data, referring to the last 30 days, indicate an increase of 2.1% in the price of bread; 2.7% for pasta; and 2.2% for flour.