January 6, 2004

 

 

Argentine Soy Prices Fall Due To Stronger Peso

 

Argentine soy prices fell on Monday due to stronger peso. Soy closed down at 650 pesos per tonne ($223) in the main soy-trading port of Rosario, after reaching its peak on Friday at 656.3 pesos, since sharp currency devaluation in January 2002.

 

Trade in Rosario reached 20,000 tonnes, similar to volume on Friday and in other recent sessions, a Rosario-based trader said.

 

"Soy fell because of the dollar," the trader said.

 

The Argentine peso strengthened 1.2 percent on Monday to end at 2.905/2.915 pesos per dollar.

 

The exchange rate often plays a key role in setting prices in Argentina, since grains and oilseeds are sold on global markets at prices set in dollars. Generally, local prices rise as the peso weakens and fall as it strengthens.

 

Although it wasn't the case on Monday, local prices tend to track movement in Chicago, where short-term futures closed upon talk that China is in the market again for U.S. soybeans.

 

Government officials privately put the 2003/04 soy crop at a record 37 million tonnes in Argentina -- the world's No. 3soy producer after the United States and Brazil. The U.S. Department of Agriculture sees output of 36.5 million tonnes.

 

2003/04 soy for delivery in April or May closed at $210 per tonne. No price was available on Friday.

 

2002/03 soy closed stable at 650 pesos per tonne in Bahia Blanca and lost just 1 peso to end at 640 pesos in Quequen.

 

Corn lost 1 peso to close at 240 pesos per tonne in Rosario and ended at the same price in Bahia Blanca. Corn closed at 225pesos in Quequen.

 

Wheat for export closed stable at 365 pesos per tonne in Rosario, and the grain lost 4 to 9 pesos to close at 360/365pesos in Bahia Blanca.

 

In Quequen, 2002/03 wheat closed stable at 350 pesos, while freshly harvested 2003/04 wheat ended at 360/365 pesos.

 

Mills in Buenos Aires paid 370/375 pesos per tonne for high-quality wheat, down from 375.5 pesos in the prior session.

 

Freshly harvested 2003/04 sunflower seeds closed down 4pesos at 590 pesos per tonne in Rosario, while 2002/03 seeds closed stable at 555 pesos in Bahia Blanca and Quequen.

 

(US$1 = 2.915 pesos)