Forward sales of soy, corn pick up in Mato Grosso
Forward sales of soybeans and corn in Brazil's central-western state of Mato Grosso picked up in January as higher prices led farmers to hedge their expected output.
By the end of last month, 68pc of the 2019-20 soybean production in Mato Grosso had been sold in advance, a record level for this time of the year over the last five seasons, the local Institute of Agricultural Economics (Imea) said.
The pace is far ahead of the five-year average of 54pc as well as last season's percentage for this period of 54pc. Soybean prices in Mato Grosso have been attractive for farmers to hedge their harvest, with the Imea index reaching R$71 ($16.5) per 60kg bag at the end of January, or 17pc higher than a year earlier.
Corn presents a similar scenario. Forward sales of corn reached 64.5pc of the expected season's output in January, from 57pc in December, 46.5pc last year and 44pc over the five-year average, according to Imea.
Due to record exports last year and uncertainties regarding the second corn crop, known as safrinha, this year, corn prices have been high in Brazil, with a bag in Mato Grosso reaching R$37 by the end of January, a 78pc jump from a year earlier.
Estimates
Imea last week raised its estimates for Mato Grosso's soybean and corn production in 2019-20. The oilseed is currently being harvested, while corn is being planted.
Soybean output is expected to reach a record of 34mn t, up from 33mn t in the October estimate and compared to output of 32.5mn t last season. The corn forecast is for 32.4mn t this year versus 31.6mn t in the prior estimate and output of 32.3mn in 2018-19.
Related news posts
Bridge collapse disrupts Baltimore UAN imports
Bridge collapse disrupts Baltimore UAN imports
Houston, 27 March (Argus) — UAN distributors near Baltimore, Maryland, are holding off from issuing new offers until it becomes clearer when the port there will reopen following its closure from a major bridge collapse. There is limited spot availability for UAN in Baltimore, market participants told Argus . At least one UAN vessel was due to arrive in Baltimore in April. Vessels delivering to Baltimore could be diverted elsewhere, possibly to ports like Chesapeake, Virginia, Philadelphia, Pennsylvania, or Wilmington, North Carolina. The east coast terminal UAN price — encompassing the US eastern seaboard — has risen by 13pc since the beginning of the year because of seasonal demand to $300/st fot on 29 February, where the price has held since. When offers for UAN in Baltimore do re-surface they will likely do so at higher levels because of restricted supply to the port. By Calder Jett Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Baltimore bridge collapse forces freight changes
Baltimore bridge collapse forces freight changes
Washington, 26 March (Argus) — Vessel traffic in and out of the Port of Baltimore, Maryland, has been suspended indefinitely in the wake of a container ship collision early today that brought down the Francis Scott Key Bridge, an accident that will force the rerouting of coal, car and light truck shipments. The prolonged closure of one of the largest ports on the US east coast could have a ripple effect on trade flows across much of the US, as shippers grapple for alternatives in the absence of a certain reopening timeline. Search and rescue efforts are still ongoing in the Patapsco River, after the 116,851dwt Dali headed to Colombo, Sri Lanka, slammed into a bridge support. The crew had lost control of the vessel. The Dali is owned by Grace Ocean and managed by Synergy Marine Group. The Maryland Port Administration said it does not know how long it will take for the shipping channel to be cleared and for traffic to resume. Shipping companies are bracing for a closure of at least two weeks, but many expect the clean-up effort could take significantly longer. President Joe Biden vowed the federal government will provide whatever resources are needed to get the port "up and running again as soon as possible." The port is a major trade hub for steam and coking coal, automobiles and scrap metal. Many market sources are still trying to determine whether the disruption will be dramatic enough to move prices. But coal markets were already being affected today. Baltimore is home to two key coal export terminals: eastern US railroad CSX's Curtis Bay Coal Piers and coal producer Consol Energy's Consol Marine Terminal. The facilities are upstream of the bridge, meaning ships will not be able to serve them until the route reopens. The terminals handle thermal and coking coal from Northern and Central Appalachia. They have a combined export capacity of 34mn short tons (30.8mn metric tonnes). The two terminals loaded 2.4mn t of coal in February, up from 2.1mn t a year earlier, according to analytics firm Kpler, mostly exports to India and China. An India-based trader said that the suspension of coal exports will probably raise prices in India, as brick kilns enter the peak production season in the summer. Buyers could look to petroleum coke as a substitute, but the higher sulphur content may not be appealing to some users despite the higher calorific value. Prices for deliveries to northern Europe are also likely to rise given that the Netherlands, Germany and Belgium combined are the second-largest market for North Appalachian coal. April API 2 futures rose by $2/t to $113.30/t. The incident has added a "level of volatility [which] could have big implications," a European paper broker said. The lack of information has prompted some coal producers to hold off on activating force majeure clauses in their contracts. Curtis Bay is served only by CSX, while CSX and fellow eastern carrier Norfolk Southern serve Consol. CSX said it is in contact with existing coal customers and contingency plans are being implemented. The railroad at this point intends to keep Curtis Bay open but will continue to assess the circumstances moving forward. Norfolk Southern did not respond to questions. Some scheduled Baltimore coal exports may be redirected to the other three eastern US coal export terminals in Hampton Roads, Virginia, but such reroutings likely will entail increased costs. Not all coal mines will be able to shift terminals. Such decisions will depend on available capacity in Hampton Roads. Exports from the three terminals in January reached a five-year high , signaling somewhat limited capacity. Mine location and railroad access may also determine whether coal can be rerouted, an industry source said. But some producers do not have much of a choice about trying to send coal to Hampton Roads. They may need the cash so will be forced into a decision. The producers most vulnerable to delays may be Consol and Arch Resources. Arch's Leer coking coal mine may be in the best position because it co-owns Dominion Terminal Associates in Hampton Roads with Alpha Metallurgical Coal Resources. The sudden lack of export capacity could put a floor under US coal prices, which have mostly been falling since last year amid low domestic demand. The competition to replace Baltimore coal exports could prevent further cuts, another coal trading source said. Metals sources say the accident will have only isolated effects on the global ferrous scrap market, but many market participants are still assessing the situation. The port is the 10th largest ferrous scrap export port in the US, and over the last five years an average of 44,000 metric tonnes/month of ferrous scrap was exported from Baltimore, according to US Department of Commerce data. But the port closure is likely to affect other freight. Baltimore is the nation's top handler of automobile traffic. Motor vehicles and parts accounted for about 42pc of all Baltimore port imports and 27pc of all exports, according to state data. The Port of Baltimore handled 847,158 cars and light trucks in 2023. "It's too early to say what impact this incident will have on the auto business — but there will certainly be a disruption," said John Bozzella, chief executive of industry trade group Alliance for Automotive Innovation. Dry bulk freight rates likely unaffected Several sources told Argus Baltimore's closure is unlikely to have a major impact on dry freight rates despite short-term interruptions to coal transports. "We are in the shoulder months with less demand for thermal coal," a shipbroker said, suggesting mild global temperatures means the collapse "may not have too much of an impact" on freight markets overall. Vessel traffic in ports such as Charleston, South Carolina, and Savannah, Georgia, may increase on diversions from Baltimore. Kpler identified 17 vessels that will likely be impacted because they are either in the Port of Baltimore or were expected to load there in the coming days. By Abby Caplan, Gabriel Squitieri, Luis Gronda, Evan Millard and Brad MacAulay Port of Baltimore coal terminals Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Germany sees no return to easy EU climate decisions
Germany sees no return to easy EU climate decisions
Brussels, 26 March (Argus) — German environment minister and green party politician Steffi Lemke has warned that easy decision-making processes for climate change and environment policies in the EU are unlikely to return after the election in June. This comes after a key EU vote on a provisional deal for climate, nature and environment was withdrawn because of a lack of member state support. Global challenges and geopolitic "are all too profound" to go back to what the EU decision-making process was like five years ago, Lemke said. But she noted that ultimately depends on the EU elections results in June and "how far extreme and populist parties gain majorities". This comes as the adoption the nature restoration law was cancelled yesterday after a number of countries, including Hungary, withdrew their support. Lemke said the vote was supposed to be "a formality" but that it is now unclear whether the law can still pass in this legislative period. The European Parliament had previously approved the nature restoration law, agreed with EU states, that commits EU countries to restoring at least 30pc of habitats in poor condition by 2030, 60pc by 2040, and 90pc by 2050. Lemke said that not adopting the nature restoration law would leave the EU more exposed to climate change. "We'll not be able to manage climate risks without nature in order," she said. Unstable ecosystems exacerbate the problems faced because of climate change, for the economy, infrastructure, human health, she said. "It's also about protecting agriculture from climate change". "US insurers are withdrawing from different regions because they can't insure climate risks anymore". "We shouldn't make the mistake of scoring easy points against climate and environmental protection," she added. "Climate-friendly states will try to get [the law] up for adoption at a later date," she added. When asked whether Germany has some responsibility for encouraging others to block provisional agreements on EU laws, she said that the country has not always been an "easy negotiation partner". But Lemke pointed out that Germany had finally approved many important laws, most recently the packaging and packaging waste regulation . The phase-out of the internal combustion engine had been particularly difficult for the German government. Other member states have also encountered major difficulties in securing government approval or parliamentary support, she said, pointing again the geopolitical situation after Russia's attack on Ukraine. Many countries have seen populist parties and right-wing extremist parties fueling uncertainty, and have had to contend with the impact of the Covid-19 pandemic and global inflation. "This had made democratic governance significantly more difficult in the member states themselves, but also in Europe," she said. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Jera delays Hekinan NH3-coal co-firing test: Correction
Jera delays Hekinan NH3-coal co-firing test: Correction
Corrects trial period in first paragraph Osaka, 26 March (Argus) — Japan's largest power producer by capacity Jera has pushed back a trial to co-fire 20pc of fuel ammonia with coal at its Hekinan power plant to after the end of March. Jera previously said the co-firing demonstration at the 1GW Hekinan No.4 unit will start on 26 March at the earliest . But the company has decided to push this back. The trial will begin sometime after the end of this month, Jera said on 25 March. It took more time to test run equipment ahead of the demonstration, with safety the main priority, it added. It is unclear when exactly the company will start the trial to co-fire 20pc of ammonia with coal. Jera aims to demonstrate 20pc co-firing of ammonia with coal ahead of planned commercial operations in the April 2027-March 2028 fiscal year. It also hopes to achieve a 50pc mixture on a commercial basis in the first half of the 2030s. By Motoko Hasegawa Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more