ABIOVE raises Brazil’s soybean export forecast

Exports of soybeans from Brazil in 2021 should reach a record 86.7 million tons, according to ABIOVE (the Brazilian association of vegetable oil industries). On July 7, due to the strong demand from China, the association raised its projection by 1 million tons compared to that released in June.

ABIOVE also reduced the forecast of ending inventories of soybeans in the country this year by 1 million tons, to 4.16 million tons, after high expectations for exports.

But the chief economist at ABIOVE, Daniel Amaral, commented that these inventory numbers could rise if the government decides not to return the biodiesel-to-diesel blend to 13% (B13), a level that was reduced to B10 due to an escalation of prices.

“China is demanding more product,” Amaral told Reuters, explaining the revision in shipments from Brazil, the largest producer and exporter of the oilseed, after foreign sales in the first half had surpassed 60 million tons.

If the new estimate is confirmed, Brazilian soy exports would exceed those registered in 2020 by 4.5% and would beat the previous record set in 2018 (83.25 million tons), according to ABIOVE.

The following chart provides a history of Brazilian soybean exports since 2018, according to DataLiner:

Brazilian Soy Exports (HS 1201) | Jan 2018 to May 2021 | WTMT

Graph source: DataLiner  (To request a DataLiner demo, click here)

He also commented that, with regard to soybean processing in Brazil, the association chose not to interfere in the crushing process, believing that the government should resume B13 in the next tenders this year.

“We chose to keep it because we have a positive expectation that the government will resume the B13. In case there is something different from that, then we are going to review these numbers; but for now, you have to wait”, he commented.

“If B10 is maintained, it is very likely that we will reduce crushing due to the drop in demand for oil,” he added. More than 70% of Brazil’s biodiesel is made from soy oil.

The association is waiting until Friday for a government position on how the mix will be, which was provisionally reduced due to high prices in the first half.

Source: Money Times

To read the full original article, visit the link:

https://www.moneytimes.com.br/abiove-eleva-previsao-de-exportacao-de-soja-do-brasil-e-mantain-esmagamento-de-olho-em-b13/

Sharing is caring!