New Delhi — Brazilian soybeans exports in the first three weeks of April surpassed the year-ago level due to higher exports in the third week of the month, sources said April 20, which is likely to support domestic oilseed prices.
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According to the foreign trade department's report released April 19, Brazil exported 10.6 million mt of beans so far in April, compared with the equivalent 2020 volume of 9.16 million mt.
Brazil exported 5 million mt of beans in the third week itself, compared with 3 million mt for the same period in 2020.
According to market analysts, almost 90% of Brazil's soy shipments have been headed to China in April, especially in the third week of the month. This trend contrasted starkly with the first three months of 2021 for Brazilian beans exports, when shipment volumes were very small.
Typically, Brazil supplies over 80% of its soy shipments to China between February and July. However, harvest delays in the South American country coupled with slackening crushing activities in China have meant lower-than-expected soybean exports to China.
High soy prices and low crush margins have forced many China-based crushers to operate below capacity since January, analysts said.
The average gross crush margin for the world's largest soybean importer was assessed at $1.98/mt in March, compared with $16.60/mt the month before, S&P Global Platts pricing data showed.
In addition, there were concerns among the China-based crushers regarding the rising cases of the African swine fever. According to market sources, soybeans demand in China remained low as downstream hog farms experienced hog losses due to the swine fever.
According to average market estimates, Brazil is expected to produce a record 134 million mt of soybeans in the 2020-21 marketing year (February 2021-January 2022) and export an all-time high volume of 85 million mt.