Increased activity at Rosario’s soybean market
Even when crush and export gross margins are very narrow in Argentina, the urgen need of getting the grain boosted prices at Rosario’s market. With better prices being offered, volume traded raised accordingly though it is still below what it is considered normal for this time of the year, when heavy progress is being made with harvest.
At the same time, dry weather conditions over the last weeks allowed a heavy advance of harvesting in the region, and by May 4th 50% of the total area has already been harvested. The gap with the average of the last 5 years is therefor reduced to 16 percentage points, although it is still the second lowest mark on record for the last decade. Hurry to harvest made sense in the face of forecasts of wetter conditions for this week.
On the other hand, it should be mentioned that on Friday the US International Trade Commission voted to continue the anti-dumping investigation against imports of biodiesel from Argentina and Indonesia. Given the importance of US as a destination of our renewable fuel exports, this is worring the industry.
With heavy activity, trading of corn outstands
Behind soybeans corn is the second most traded grain, standing out the relatively sustained values and the wide range of delivery options that are being trade in the local market. Today, we find open values to buy corn for all the months that go from May until December of 2017, and from March 2018 to July 2018, the latest referred to the 2017/18 crop season.
It is outstanding the program of shipments for the next couple of weeks. According to the NABSA, Argentina is set up to deliver 1.6 million tonnes of corn from now to the end of May, 1.2 million of which should be shipped from the terminals ports at the Up River, in Rosario. Going forward, exporters are reluctant to commit the deliver of grains before July, in the face of fears that the still excessive moisture in Argentina’s soils further delays harvest. With an exportable balance of around 23 million tonnes, hopes are set to achieve a record in shippments the current season.
Snowstorms in the US awakened wheat
Last week's snowstorms in the United States raised fears about the quality of world wheat, which is already hit by adverse weather conditions in Europe and lower supply forecasts for the new Australian crop year. Future prices at Kansas market showed a very volatile behavior during the week, closing Thursday with a rise of 3.0% relative to the previous week to USD 156.5 / t, after touching a relative maximum of USD 162.8 / t in the week.
As exporters needed to secure the grains, prices at Rosario's market replicated the bullish trend. Traders are more optimistic about foreign sales for our quality wheat, raising their willingness to offer better prices.