Activity at Brazilian Ports Indicate Strong Global Grain Demand
The number of grain ships arriving at Brazil’s port to load soybeans and corn is expected to increase 75% over last year’s numbers at this time, signaling strong overseas demand for grains.
Eighty ships are arriving at Brazilian ports to load 4.78 million tons of soybeans and 82 ships are arriving to load 4.53 million tons of corn, according to data from shipping agent, Williams. At this same point last year, 57 ships were arriving to load 3.2 million tons of soybeans, and 40 ships were arriving to load 2.16 million tons of corn.
The depreciation of the real by 23% against the dollar so far in 2015 has boosted Brazil’s competitiveness on global markets against rivals such as the U.S. Because of the depreciation, local prices offered for soybeans have been rising despite a recent drop in Chicago soybean prices. The price for a 60-kg bag of soybeans at the port of Paranagua is at its highest value in three years at 79.53 reais, according to price discovery analyst, Esalq/Cepea, and the export premium for Brazilian soybeans for September delivery at the port of Santos is at $1.27 per bushel – up 44% since the beginning of July.
The resulting strong overseas demand has led Brazil’s Agriculture Ministry’s crop agency, Conab, to revise its forecast for shipments upward to 49.1 million tons of soybeans and 26.4 million tons of corn.