Farmers hoard soy in Argentina while US farmers to plant record crop
Argentina-the top exporter of soy oil and soybeans-is expected to hold soybean stock of about twice America's stock and this is expected to continue to rise in the next season.
USDA staff in Buenos Aires expects soy stocks will end the newly-started 2013-14 season at 11.6 million tonnes, and hit 14.1 million tonnes by the end of 2014-15, equivalent to one-quarter of the harvest. The bureau's estimates for 2013-14 are based on a forecast for production of 54.0 million tonnes, in line with the USDA's official forecast, and for next year of a 57.5 million-tonne crop.
Argentina's farmers are widely seen hoarding their soy harvests as a hedge against inflation, which is estimated over 30%, as crops offer dollar-denominated security against peso depreciation.
In December, Argentine newspaper Cronista Commercial estimated that Argentine soybean farmers were holding 11.5 million tonnes of soybeans. Respected crop scout, Dr. Michael Cordonnier, says that as of March, Argentine farmers were still holding onto 5 million tonnes of last year's soybean crop.
Safras e Mercado expects Argentina to match the previous record crop at 54.5 million tonnes and pegged the Brazilian crop at 86.9 million tonnes on Friday. Dr. Cordonnier forecast the Brazilian soybean crop at a record 86.5 million tonnes, with Argentina at 53.5 million tonnes, both were unchanged from his previous estimates.
Brazil's ABOIVE meanwhile cut their estimate for Brazilian soybean exports in 2013/14 from 44 million tonnes to 43 million tonnes, due to weaker Chinese demand. Reuters reported that two cargoes of Argentine meal have been sold into the US east coast and that more deals are being discussed.
US farmers are soon expected to begin planting a record 2014 soybean crop this year.