Brazil Soymeal Exports Soar As Drought Disrupts Argentina Export Route
Soymeal shipments from Brazil's Paranagua port jumped in September driven by strong demand and a drought that has disrupted a traditional logistics route via Argentina.
In a statement sent to Reuters on Friday, Brazil's Paranagua port authority said exporters shipped 419,314 tonnes of soymeal last month, a 35% rise from August and almost 33% up from the same month a year ago.
International prices and demand favoured an increase in soymeal exports from Brazil, according to the Paranagua Export Corridor Terminals Association, cited in the statement.
In addition, shipment in Brazil of soymeal brought in from Paraguay has been a factor.
'The neighbouring country, which used to transport its soymeal by barge to Argentine ports ... had to look for alternatives,' the Paranagua port authority's statement said.
Low Water Level
Due to the drought and low water level on the Rio de la Plata basin, those barges cannot sail so the product is being sent by road and shipped from Brazil, the statement added.
Large Brazilian farm cooperatives like Coamo and multinationals including Cargill and Louis Dreyfus shipped soymeal from Paranagua in September, according to the statement.
A forecast 150,000 tonnes of soymeal should arrive from Paraguay to be exported from Paranagua, located in Southern Brazil, by the end of this year, the authority said.
As the drought persists, some 400,000 tonnes of Paraguayan soymeal are expected to arrive and be shipped from Paranagua in 2022, the statement added.
Brazil's main competitor on international soymeal markets is Argentina.
Impact On Pricing
"The drought on the Rio de la Prata also affected the price of the Argentine product, making it less competitive and opening the market for Brazil," the statement said.
Elsewhere, Argentina's corn crop is expected to grow to a record 55 million tonnes in the 2021/22 season, the Buenos Aires grains exchange has said in September, booming on expanded planting area at the expense of 2021/22 soybeans, the country's main cash crop.