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March 26, 2013

Long Tail Expected for Brazilian Soybean and Corn Exports

Brazilian farmers are going to harvest a record large soybean crop and potentially a record large corn crop as well. The record production is going to lead to record large exports as well, but congestion and long delays at Brazilian ports is going to result in an extended export season in Brazil.

In 2012, the Brazilian soybean exports came to a quick end in August and September due to a short crop and a front loading of the Brazilian exports. That will not be the case in 2013 due to the size of the crop and a somewhat delayed start to the export season.

The 2012/13 Brazilian soybean crop is record large and the Brazilian soybean exports have gotten off to somewhat of a slow start. According to the Exterior Commerce Secretary (Secex), from the first of the year through mid-March, 4.1 million tons of soybeans were exported from Brazil compared to 4.9 million tons during a similar period in 2012. There are no more berths this year compared to last year at the two main ports in Brazil, Paranagua and Santos, so there is a limited ability to increase the export pace.

As a result, the soybean export season in Brazil is expected to be extended until November or December or even later this year. Additionally, Brazil could also produce a record large corn crop this year as well and the corn exports could compete for space at the Brazilian ports which could extend the soybean export season even further. Certainly, the U.S. is going to face export completion from Brazil this fall for both soybeans and corn.