Decline in Soybean Prices Despite Dollar Increase
June was a challenging month for soybean prices and trading in key regions of Brazil. Despite a significant rise in the dollar, soybean futures fell sharply in Chicago, which heavily influenced domestic prices.
Chicago Board of Trade (CBOT) Performance
On the Chicago Board of Trade (CBOT), November contracts recorded a 6.3% loss during June, with prices dropping to $11.10 per bushel by Friday morning, June 28. The strong performance of U.S. soybean crops has pressured prices.
Brazilian Soybean Prices
In Brazil, the price per 60-kilogram sack decreased in major markets throughout June. Notable changes included:
- Passo Fundo (RS): Dropped from R$134.50 to R$133
- Cascavel (PR): Fell from R$132 to R$128.50
- Rondonópolis (MT): Stabilized at R$125
- Porto de Paranaguá: Decreased from R$140 to R$139
Impact of Currency Exchange
The decline in domestic soybean prices could have been more severe if not for the exchange rate factor. The dollar surged by 5.5% in June, surpassing R$5.55 on Friday morning. Fears of fiscal imbalances in the Brazilian government propelled the rise of the U.S. currency.
Soybean Losses in Rio Grande do Sul
Soybean harvesting in Rio Grande do Sul has concluded, according to Emater/RS-Ascar. Approximately 10% of the area in the southern part of the state was abandoned, resulting in an estimated productivity of about 1,500 kg/ha.
Following the harvest, producers are seeking advance credit for the 2024/25 season to maintain Proagro conditions, as there is a planned reduction in insurance coverage for the next agricultural period. The cultivated area in the state is estimated at 6,681,716 hectares, with an average state productivity of 2,923 kg/ha (48.7 sacks).
The recent trends in soybean prices highlight the complex dynamics between global market conditions, domestic production challenges, and currency fluctuations. Stakeholders should stay vigilant and adapt strategies to navigate these multifaceted influences as they plan for the upcoming agricultural season.