Truck arrival at ports grows strongly with harvest of late maize

Truck arrival at ports grows strongly with harvest of late maize

Since the beginning of July, the number of hectares of maize harvested grew considerably, which led to a high number of trucks arriving at the ports. Due to the downspout of the Paraná river, the importance of the southern ports of Buenos Aires province grew.

The maize harvest progressed strongly in the last month and is virtually finished, with only 2% of the area remaining to be harvested at the national level. A large part of the current campaign was planted with late-planted maize. This has resulted in a large number of hectares being harvested between the beginning of July and the beginning of August. The number of weekly hectares harvested since the beginning of July 2021 has been high, rising above the record of previous years in several weeks, particularly from the middle of the month to date. In addition, in that period 3.5 million hectares were harvested in total, 39% of the total area.

This high area of ​​maize harvested in the last month has led to a marked increase in the number of trucks entering the country’s ports. In fact, since the beginning of July of this year to date, 151,648 trucks have entered the ports of the greater metropolitan area of Rosario city, which marks a rise of 27% compared to the same period in 2020, while in the ports of the south of Buenos Aires’s province, 48,394 units arrived, 31% more than the previous year.

But, in addition, the severe downspout of the Paraná River is causing logistical problems in the loading of ships in the Up-River ports, for which a high proportion of the cargo must be relocated to the southern ports of Buenos Aires. In 2021, the unloading to the ports of Bahía Blanca and Necochea / Quequén cities has grown considerably, exceeding records from previous years. In the greater metropolitan area of Rosario city, meanwhile, the number of trucks entered is above the 2020 record but below the 2019 figure.

Likewise, this increase in the arrival of trucks with maize to the ports of southern Buenos Aires is also consistent with the numbers of shipments. In July and August of this year, the total of tons of maize shipped and scheduled to be shipped from Argentine ports amounts to 9.1 Mil MT, of which 67% originate from the ports of Great Rosario, while 30% from the ports of Bahía Blanca and Necochea / Quequén cities. This is the lowest relative importance of the Up-River ports (and, in parallel, the highest of those in southern Buenos Aires) since at least 2018.

Regarding SB, there are two interesting phenomena to analyze, and that are related to each other. On the one hand, SB exports in the first three months of the campaign reached 1.8 Mil MT, that is, 56% less than in the first quarter of the previous cycle. In addition, it is the second-lowest volume in the last decade, only surpassed by what happened in the 2017/18 cycle, that of the fateful historical drought that severely affected production. On the other hand, soy crush in the first 3 months of 2020/21 totaled 12.6 Mil MT, 10% more than in the first three months of the previous season and registering the second-best figure of the last decade.

This is explained, fundamentally, by the rise in oilseed oil prices. Vegetable oils have seen a phenomenal bull rally in the last 12 months, including SB oil. The rise in prices has improved the oil share (the oil’s share in the total value), encouraging greater local processing of beans and then exporting derived products, to the detriment of raw grain exports. Meal exports between April and June totaled 8.45 Mil MT, an increase of 17% compared to the 2019/20 cycle and the highest volume in six years, while oil exports in the first quarter of the season amounted to 1, 83 Mil MT, the best record ever.

International level

At the international level, the news of the week comes from the lower projected global maize production. For 2020/21, the cut comes from the side of Brazil. The severe drought that affected the late-planted maize or safrinha in the south of our neighboring country was now joined by the frosts of the last month. Given this, CONAB (the Brazilian food agency), reduced its estimates for the production of late-planted maize in that country by 19.6% compared to the production of the previous campaign to 60.3 Mil MT, a drop of 6,6 Mil MT. This way, according to the agency, maize production in Brazil would reach 86.5 Mil MT, which is 15.5% less than in the 2019/20 season.

New USDA projections in its monthly Global Supply and Demand report were aligned with the above-mentioned. According to the North American organization, the production of corn in Brazil would reach 87 Mil MT, with a cut of 6.5 Mil MT.

As for the 2021/22 cycle, the United States Department of Agriculture also sharply cut maize production for the North American country. According to the agency’s new projections, the US would obtain 374.7 Mil MT, with a reduction of more than 10 Mil MT compared to its July estimate. If these projections come through in the US, this would mean an increase of 4% compared to the previous season and the highest volume in six years.

In terms of prices, this news of a lower global supply of corn has boosted prices considerably. The price of nearby maize contracts in Chicago reached its highest price in more than a month on Thursday, closing at USD 225/MT. Meanwhile, the prices in the local market exhibited the same behavior as the prices in the North American market: the equivalent price in dollars on Thursday of the Rosario Cereal Arbitration Chamber (CACR) reached USD 195.9/MT, four dollars above the previous day, and the highest value in a month.

As for the prices of SB, they have remained relatively stable in the last week. Unlike what happened with maize, the USDA did not report strong changes regarding the production and uses of the oilseed, so prices have not exhibited great variations. The adjustment price of the contract with the highest volume traded on Thursday reached USD 492.7/MT, practically unchanged from the prices of a week ago. As for prices in the local market (the equivalent price in CACR dollars), these have risen almost USD 10/MT in the last week, reaching USD 339.6/MT on Thursday 13, and a maximum since June 2.

Source: https://bcr.com.ar/

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