Brazil could export over 9.50 million mt of soybeans in March: sources

Brazil is forecast to export over 9.50 million mt of beans in March, up 12% year on year, based on current pace of weekly exports, according to the market sources.

The country has already shipped out 7.18 million mt of soybeans in the first three weeks of March, double February's volume, the Brazilian foreign trade department said Tuesday. Also, its soy exports so far in March have averaged 479,200 mt/day, from 445,200 mt/day in the same period last year, the trade data showed.

Brazil is the world's largest soybean supplier.

Despite the US-China Phase 1 trade deal signed January 15, Chinese crushers are still buying large quantities of Brazilian beans, a market source said. Additionally, profitable crush margins have encouraged Chinese soybean buyers to continue covering their old crop and new crop demand.

China is the world's largest soybean importer and buys over 75% of Brazilian soy shipments annually.

Some South American analysts have adopted a bullish view on Brazilian soy sales in the coming months. As the Brazilian harvest season peaks in April, they expect China and the EU to buy more Brazilian beans over US-origin.

In its most recent report, Brazilian national agro agency Conab forecast soybean output in the 2019-20 crop year (September-August) at an all-time high of 124.2 million mt, up 8% year on year. The country's harvest has already touched 70%, which is on par with the five-year average, due to favorable weather across key states since November 2018.

Market participants say the forecast for a bumper soybean production in 2019-20 could further help the price competitiveness of Brazilian beans in China and the EU.

The price of SOYBEX FOB Santos for May loading was assessed at $350.37/mt Wednesday, while SOYBEX FOB New Orleans was at $352.19/mt.

CORONAVIRUS CONCERNS

The COVID-19 pandemic has injected considerable unpredictability into the global soybean trade in the short term at the very least.

Chinese soybeans buyers have slowed purchasing activities in recent days due to the uncertainty surrounding port and logistics infrastructure in Brazil and Argentina, market sources said. As quarantine steps are adopted across South American ports, the uncertainty grows.

There is heavy ambiguity over continued port operations in the coming days as the virus spreads unabated, a Chinese crusher said.