September 29, 2003



Brazil Soy Market Jittery Over Rising Prices


The perverse reaction of soybean farmers to price rises meant that local market sales were slow over the last couple of days.


World soybean quotes have taken off in recent weeks, but traders said farmers were waiting to see how high prices would actually rise. "It's always the case. Few try to get a good average on the sales, instead they try, and often fail, to sell at the peak," said one Sao Paulo- based trader.


Local prices continued to rise but still haven't reached the peaks of last year. According to a survey conducted by the local AgRural consultancy, the average price across 30 Brazilian markets was 39.35 Brazilian real ($1=BRL2.94) on Thursday, some 9.5% lower than the BRL43.50 seen one year before.


However, in dollar terms, this year's price is 16% higher than that last year. "And a lot of soy costs are in dollars, the prices are excellent," said the trader.


The arrival of rains in the central regions has allowed planting to start over the last weeks while in the municipality that traditionally kicks off planting, around 15% of the crop will have been sown by next week.


Planting will spread down the country from north to south over the next weeks and months, ending in Rio Grande do Sul state in December.