Falls Much Soybean Planting in the USA
(Summary and reflections of the March Agro)
PHOTO: REUTERS
Prof. Dr. Ahmed Fadi
We go to the summary of the main facts of agribusiness this month of March, Beginning with a turn to the past to contaminate us with pride. Wow Grain production, when analyzing the period of 1975 up to 2017 jumped from little More than 40 million tons to almost 240 million. Productivity has grown 3.43% per year, thanks to commercial openness, technology, mechanisation, education, professionalisation, credit, research, entrepreneurship, diversification of Production and integration of crops. In the same period the meats had Amazing jump: Chicken was from 370,000 to 13.5 million tons, pigs from 500,000 to almost 4 million, and bovine from 1.8 to 7.7 million tons.
Speaking of the present, the production estimate of the National Company of Supply (Conab), is now in 233.3 million tons, above the harvest 2017/18 (227.7 million tons) but practically 1 million tonnes Below the February estimate. The main tumble was in soybeans, where they were Expected 120 million tons and we should have 113.5 million (last Harvest was 119.3 million). The ABIOVE predicts a little more, 116.9 million tons, 1 million unless estimated in January, as well as Agroconsult.
In soybeans, we have almost finished harvesting, 80%, and the climate risks have fallen considerably. The Strongest risk Now Is the second crop, mainly in maize, which Conab estimates in almost 93 million tons, which would be the second largest in our history. With The weather helping, this Corn will supply well all the demands of both the internal and external market, and ethanol production. According to the IMEA (Mato-Grossense Institute of Agricultural Economics) Planting in the DM was completed with almost 96% planted in the Best window.
The USDA (Department of Agriculture of States) released at the end of the month the planting expectations for 2019/20. To Corn, a 4% larger area is expected, totaling 37,560,000 hectares and the Stocks are 218.4 million tons (fell 3% in a month but are above than predicted analysts in more than 6 million tonnes). In soybean, Fall should be 5% in the planted area, totaling 34,240,000 hectares. But as stocks are too high (almost 74 million tons and 30% than on the same date as last year), this number has not changed the price. For wheat, they expect to plant 4% less, total of 18,540,000 hectares (also very high stocks), as well as 2% lower in cotton, with 18,540,000 of hectares. The main good news is the smaller area of soybeans, but with little Immediate effect.
The grain stocks in the world are in Very comfortable level, which forces the permanence of prices probably in the Current levels. By the USDA, in maize, at the end of the 2018/19 Harvest (August Year) inventories will be above 27% of the need for annual demand (falling 31.4% in the previous crop). In soybeans, the stock will be close to 30% of what will be needed in a year. Therefore, in Prices, if no new facts appear, is stability ahead.
Agro’s export performance Is still very good in February, We sold US $7.2 billion, growth of 15.6% compared to the same month of 2018. Imports also grew by almost 10.5% and reached US $1.2 billion. The Agro surplus grew 16.5% in February, reaching US $6 billion. Just Soybean were US $2.21 billion, double compared to last year. By the data of the MAP, the meats reached US $1.1 billion, almost 5% more. The Café Also Grew 10.4%, reaching US $452.3 million. Who fell was the complex Sugarcane (sugar and ethanol), a total of 22.8% bringing US $425.7 Million.
Since the beginning of 2019, we have exported 10.6 million tons of Soybean, bran and oil, almost 50% more than the same period of 2018, bringing US $ 3.9 billion, representing 44.4% more. Prices are about 3% lower. The China bought almost 33% of everything that was exported, a total of US $2.3 Billion, 77.2% more than February 2018. Even importing 18% less than Brazil soybean in February, China bought more than 5 million tons, 134% more than February 2018. In the first two months of the year We sell 7 million tonnes, twice as much as 3.5 million of 2018. With this, they entered In Brazil US $2.5 billion, almost twice as much as the US $1.3 billion of 2018. Effects of problems with the US.
And This is one of the main international facts to be monitored. We have to be afraid of an agreement between US and China and the impacts on the area Because China would have to increase its U.S. purchases. And Think too As would the exchanges of channels, for the additional American production that would For China would be redirected partly from other buyers markets, Opening spaces in these if we have access.
About China, they can be very positive to Brazil, the impacts of the plague Swine production. There was already vigorous growth of Export prices. The Chinese offer in January was 12% lower, with a fall of Sale of soybean rations and purchases. In Addition to growth in meat purchases Swine, was also observed in other meats and for the first time China was the Largest chicken buyer in Brazil, according to ABPA.
The “Magical Quintet” to be observed in the next 30 days: 1) The Rain on maize; 2) Progress of China vs. USA negotiations; 3) The impacts of African swine fever in Chinese meat production and imports; 4) The binomial Oil prices and addition of more corn ethanol in U.S. gasoline; and 5) the Progress of the reforms, with impacts on the exchange rate and the tributary On agribusiness.
Marcos Fava Neves is Full Professor (part-time) of USP’s Management Colleges in Ribeirão Preto and FGV in São Paulo, a specialist in strategic planning Agribusiness. Check out texts, videos and other materials on the website doutoragro.com
