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April 29, 2020

Brazil Continues to Export Soybeans at a Record Pace

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

The 2019/20 Brazilian soybean harvest should be complete in a few days and Brazil continues to set records for soybean exports. Thus far in 2020, Brazil has exported 31.4 million tons of soybeans compared to 24 million during the same period in 2019. Brazil's soybean exports are going full force thanks to the Brazilian currency that is setting record weakness compared to the U.S. dollar.

At one point last week, the Brazilian currency was trading at more than 5.7 reals per dollar. That compares to about 4.3 reals per dollar at the start of February.

The average export pace last week was 826,000 tons of soybeans per day. If the pace continues for the last few days of April, it will set another monthly record of more than 14.5 million tons for April.

The principal destination for Brazilian soybeans is China. Except for a few purchases from the United States last week, China is purchasing their soybeans almost exclusively from Brazil. The consulting firm Agrosecurity Consultoria indicated that China purchased 26 cargos of Brazilian soybeans just last week. The weaker currency allows Brazilian soybeans to be very competitive in the international market while at the same time offering high prices for Brazilian farmers.

On Monday of this week, the Brazilian Minister of Agriculture, Tereza Cristina, indicated the Brazilian food supply is secure and that the logistics across the country is basically operating normally with all the ports up and running in spite of the Covid-19 pandemic.

The part of agriculture hit hardest by the pandemic has probably been the sugar/ethanol sector. In fact, representatives from the sector are requesting urgent help from the Minister of Agriculture due to the low demand and low prices for ethanol caused by the collapse of the oil market and the Covid-19 crisis. Ethanol