July 9, 2008

 

CBOT price slide slows Brazil's soy market

  
 

Brazil's physical soy market saw slow business this week as soy prices fell on the CBOT, brokers and analysts said Tuesday (July 8, 2008).

 

"The physical soy market is almost at a standstill," said Steve Cachia, a soy market analyst at brokerage firm Cerealpar.

 

This week CBOT fell from its record US$16 per bushel level last week and August soy futures on Tuesday fell 30 cents to US$15.49 a bushel on CBOT.

 

"Prices have been low since July 4, and (soy) sellers are looking at short-term prices and are unwilling to sell at lower prices," said Cachia.

 

Soy premiums at the Paranagua port saw little agreement between buyers and sellers. According to Cerealpar, buyers were offering 20 cents over the August CBOT soy contract, while sellers asked for 30 cents above. Buyers offered 40 cents over the September CBOT soy contract, with no sellers.

 

Cachia said the Brazilian market will be paying close attention to the USDA soy data to be issued later this week.

 

Business has been slow since the record (CBOT) high last Thursday, said a trader at a leading US multinational soy exporter, noting that lower prices now meant producers are even less inclined to sell.

 

Soy business was done at a premium of 20 over CBOT for a July soy futures contract and 25 over for the August CBOT contract at the port of Santos, he said.

 

All eyes are on the weather in the US, which has a good 6-to-10 day weather forecast, said the trader.

 

Brazil's 2007-08 soy crop is 81percent sold as of July 4, according to agribusiness consultancy Celeres on Monday.

 

Chinese buying of Brazilian soy, which has been active so far, are also slowing.

 

China has imported 8.7 million tonnes of Brazilian soy out of 10.4 million tonnes of soy exported to Asia from February 1 until July 4, he said. This was a million tonnes more than the same period last year.

 

Asia accounted for 67percent of Brazilian soy shipments, while Europe accounts for 32percent this year, the trader said.

 

Brazil's 2007-08 soy harvest has virtually wrapped up and is estimated to reach 59.8 million tonnes, up 2.5percent from 2006-07, Conab said Tuesday.
   

Video >

Follow Us

FacebookTwitterLinkedIn