The production cost of soybean 19/20 in Mato Grosso for the month of March/19 was updated by Imea. According to the data, variable costs (VC) closed the month at BRL 3,125.80/ha, up by 0.59% over February, and operating costs (OC) closed at BRL 3,472, 03/ha, a monthly advance of 0.60%.
The price increases were mainly due to the increase in taxes and high exchange rates reached by the dollar during the month of March. The pesticides had a readjustment of 0.78% and, among them, the fungicides presented the highest value.
Analyzing other important components, soybean seed, macronutrients, and rental costs were also higher. From now on, with the completion of the harvest, farmers need to focus their attention on planning their next crop.
Featured items include:
• The Imea-MT Indicator remained stable and closed the week with an average of BRL 63.17 / sc.
• Presenting a 1.27% depreciation, the current CME-Group contract ended the week at USD 8.87/bu, due to the weight of the offers held in the US, and a better climate outlook for planting.
The US dollar ended the week with a 1.32% rise and an average price of BRL 3.91/USD, due to the postponement of the vote on the pension reform by the Constitution and Justice Commission (CCJ).
• The northern and northeastern regions closed the soybean harvest, and the state of Mato Grosso reached 100%, after a weekly advance of 0.08 p.p.
ASIAN GIANT:
Being the largest soybean buyer in the world, the Chinese demand is an important factor in the formation of world grain prices, having a decisive impact on the market. China released its preliminary soybean import data in March with a total of 4.92 million tons, up 10.26 % from February.
Despite this increase, this volume is 13.12% lower than the volumes of March/18. The same is seen when we observe the accumulated totals from January to March, which in 2019 registered 16.76 million tons, a reduction of 14.33% compared to 2018, with 19.56 million tons.
If the Asian country maintains this behavior of smaller imports in the coming months, a lower Chinese demand for soybeans could be confirmed. This, together with the high US stocks, and the greater supply in South America, are factors that can put pressure on soybean prices.
