Positive forex supports Brazilian soy trade

Brazil's soy trade this week has been supported by the favourable forex despite falling international prices, industry participants said on Thursday.

Most of the international and local crushers and exporters this week have been trying to buy soy in Brazil, the world's No. 2 soy producer after the US, a chief trader at a major US soy exporter said.

Brazilian soy farmers were willing to sell small amounts of beans this week as the dollar strengthened against the Brazilian real. These encouraged sales despite lower prices on CBOT, the trader said.

Nearby CBOT July soy, the most-active contract, were 6 cents lower at US$9.32 on Thursday (May 20). One dollar, however, continued to strengthen to BRL1.88 (US$0.998) on Thursday from BRL1.84 (US$0.977) at Wednesday's close and BRL1.82 (US$0.966) at Tuesday's close.

A Brazilian broker said that soy were being sold in early trade on Thursday at around BRL39.50 (US$20.98) per 60-kilogramme bag at the port of Paranagua, the country's main grain port.

Buyers were offering on Thursday premiums of 46 cents over the July soy futures contract on CBOT. Sellers, however, wanted around 49 cents over the same contract, he said. The number of sellers remains light, the broker said.

Brazilian agricultural consultancy Celeres this week said that producers had sold 54.4% of their beans as of May 14. This was up from 52.5% in the previous week and 63.3% from a year ago, Celeres said.

Mato Grosso, Brazil's top soy producing state, is the most advanced regarding sales with 73% of the soy sold as of May 14. Farmers in Parana, Brazil's No. 2 soy-producing state, had sold 37% of their soy, Celeres said.

Brazil's soy harvest is 99.7% complete as of May 14, Celeres said.