November 20, 2014

Soy Forward Sales Increasing in Mato Grosso still Lag Last Year

Farmers in Mato Grosso have taken advantage of improved soybean prices to increase the forward contracting of the 2014/15 soybean crop. According the latest assessment from the Mato Grosso Institute of Agricultural Economics (Imea), farmers in the state have now sold 25% of their anticipated 2014/15 soybean production. While this is an improvement over recent weeks, it is still considerably less than the 44% that had been sold last year at this time.

The amount of forward sales of soybeans varies by region in the state with the northeast region at 33% sold, southeast at 25%, west at 25%, central at 23%, northwest at 22%, and northern region at 16% sold.

Until recently, Brazilian farmers had been reluctant to sell their soybeans due to low prices, but the combination of improved prices at the Chicago Board of Trade and a weaker Brazilian currency has resulted in improved prices in Brazil. The price of soybeans in Mato Grosso increased 2.6% last week to an average of R$ 56.27 per sack (US$ 10.23 per bushel using an exchange rate of 2.5 reals per dollar.

Approximately 85% of the 2014/15 soybean crop had been planted as of late last week which is 9% less than last year.