Brazilian soybean meal prices are on the rise as Argentina faces potential supply issues due to a looming strike by the oilseed union SOEA, which threatens to disrupt processing capacity. Recent price assessments suggest that Brazil is becoming a more attractive option for traders, with active trading observed in the Brazilian market. Estimates by S&P Global indicate that Brazil is set to outperform Argentina in soybean crushing and meal exports in 2025.
Recent market dynamics indicate that Brazilian soybean meal prices are gaining an advantage over Argentina due to emerging uncertainties regarding Argentine supply. On February 26, Platts reported the price for Brazilian soybean meal at $327.38 per metric ton (mt) for FOB Paranagua, compared to $323.53/mt for the Argentine FOB Up River market. This shift comes amidst concerns about Argentina’s oilseed crush capacity as the possibility of a national strike looms on the horizon.
The Argentine oilseed union, SOEA, announced intentions to organize a national strike due to unresolved wage disputes with Vicentin, a significant player in the soybean-crushing arena. SOEA expressed concerns regarding Vicentin’s ability to pay wages for February, threatening to disrupt operations across all oilseed facilities if the issue is not resolved. This situation is exacerbated by existing doubts about the immediate processing capacity in Argentina, prompting traders to secure positions in Brazil where the market is currently perceived as more stable.
As traders anticipate potential supply shortages from Argentina, activity in the Brazilian market has intensified. Reports from Platts emphasize a shift in the premium market at FOB Up River, with changes in price movements indicating traders are reacting to the uncertainty in Argentine operations. Recent trades in Brazil saw an improved basis, indicating heightened operational activity, particularly for April shipments.
Additional weather forecasts suggest improvements for Argentina’s soybean crop, as rain may benefit the crops that had previously suffered drought conditions. In contrast, Brazil’s harvesting activities are expected to accelerate, with forecasts indicating 36% completion as of February 19. Moreover, the Brazilian government’s decision to postpone an increase in biodiesel blending may reduce demand for soybean oil, consequently affecting crushing and production of soybean meal.
S&P Global Commodity Insights currently projects Brazilian soybean crushing at 57.50 million mt for 2025, with an anticipated export of 23 million mt of soybean meal. Conversely, Argentina’s estimates stand at 44 million mt for crushing and 30 million mt for soybean meal exports, highlighting the competitive landscape in the oilseed sector amidst these evolving conditions.
In summary, Brazilian soybean meal is currently experiencing a price advantage due to uncertainties surrounding Argentine supply and the potential for industrial strikes affecting production. The Brazilian market has seen increased trading activity as traders react to these developments. Projections indicate a significant disparity in soybean crushing and export expectations between Brazil and Argentina, underscoring the competitive dynamics at play in the global oilseed marketplace.
Original Source: www.spglobal.com
