Brazil's soya farmers delay new-crop sales due to low prices

Brazil's Mato Grosso soyabean producers have sold less of their new-crop beans so far than they did last year, when sales were already late compared with long-term averages, as they hoard grains in the hope of better prices ahead. Despite the prospect of another bumper soya crop, a drop of domestic prices following Chicago futures and as a result of an appreciation of the Brazilian currency reduced farmers willingness to close forward sales, they said to people taking part in a crop tour in the leading grain producing state this week.
Farm cooperative Coacen, based in Sorriso, Brazil's largest soya producing municipality, sold about 40 percent of this year's estimated output, 10 percent below last season and 15 percent lower than two cycles ago, Chief Executive Evandro Lermen said on Wednesday.
"Farmers expected to capture more value on the soya in January, but were frustrated," he said referring to 43 families of associated producers, who are now starting to harvest their crops.Overall, Mato Grosso farmers have sold 42 percent of the state's estimated crop of 30.6 million tonnes. This is nearly 13 percentage points below the average of the past five harvests, according to agricultural research institute Imea.
The situation signals another tough season for global grain traders, which have grappled last season with slim margins amid soyabean hoarding in the world's largest exporter.
"Even if Chicago prices do not rebound in the next few months, demand will exist and trading firms will have to pay better premiums to source the soya," said agronomist Fibio Meneghin, a partner at Agroconsult, the consultancy leading the tour. He believes traders risk having another year of negative margins in Brazil.
Fields are in a similar or better condition than last year, according to Meneghin. Agroconsult could revise yields and output forecasts upward in February after a survey of the soya planted earlier is concluded. It last estimated Brazil's soya production at 114.1 million tonnes, with average yields of 54 bags per hectare, the second best in history. Farmer Wanderson Mazzardo, who has harvested about 5 percent of his soya so far, said his family sold around 10 percent of expected output compared with about 60 percent at this point in time last season.
"Sales have lagged," said producer Diogo Chiarelotto, adding that appeared to be "no ideal sales window" this season. So far, he traded an estimated 15 percent less soya than in the same period last year.