Sowing delay in Brazil and its impact on market prices in 2024

Market operators expect U.S. soybean exports to increase in the first quarter of 2024 due to planting delays in Brazil. This is likely to support oilseed futures prices during this period.

Typically, U.S. soybean exports peak in October-December and remain stable until at least mid-February, when cheaper Brazilian soybeans begin to arrive on the market. However, Brazil has been experiencing adverse weather conditions caused by the El Niño phenomenon since October. As a result, the country's soybean planting campaign has been delayed by almost two weeks compared to the average for the last 5 years, and in the state of Mato Grosso the delay is almost a month.

Thus, competition in the global soybean market between Brazil and the United States will be quite fierce. S&P Global estimates China will import a record 101 million tonnes of soybeans in 2023/24, with the USDA giving an even higher estimate of 102 million tonnes.

In recent years, Brazil has been the main supplier of soybeans to China - about 65%, while the US usually supplies about 25%. This trend is expected to continue into 2023/24.