Less tension on the soybean market due to China’s Covid policy
International soybean prices are falling slightly. The IGC price index, a measure of the price of soybeans in the world, fell to 297 points on Monday, December 5 (year 2000 = index 100). A week earlier, this index was at 304 points.
There are reports that due to the public protests, China is about to relax strict Covid policies. It makes the market less tense. In addition, the United States sold 130,000 tons of soybeans to China this week.
South American harvest
Looking further ahead at the soy market, a good harvest is expected in the South American countries. Although it is quite dry in Argentina, which is unfavourable. At the end of this week it is expected to rain in the north of Argentina, unfortunately that will not be enough.
Less precipitation than expected
Cepea, the economic research centre of the University of São Paulo, reported late last week that precipitation in south and central western Brazil is less than expected. In Brazil, the soy crop is estimated to reach a record 152 million tons for the 2022-23 season, according to the latest Wasde report from the US Department of Agriculture (USDA).
In comparison, Brazil harvested 127 million tons of soybeans in 2021-22. The nextWasde report will appear at the end of this week. At the beginning of this week, the French market agency Agritel assumed a slightly smaller Brazilian soybean harvest; about 150 million tons.
Delay sowing in Argentina
In Argentina, even less rain fell than in Brazil, which delayed sowing work. According to the Argentinian grain council, Bolsa de Cereales, just under 20% of Argentina’s soybean area had been sown on November 24. A year earlier in the same period this was 40%.
