South America Calling
Alastair Stewart South America Correspondent

Friday 06/13/14

Soybeans Leads Brazilian Exports in 2014

Soybeans have been the single biggest export item on the Brazilian trade balance so far this year, underlining the growing importance of the oilseed to the local economy.

Bean exports rose 22% on the year to $12.6 billion in the first five months of 2014, beating the traditional No. 1 item, iron ore, which accumulated revenues of $11.7 billion.

When soymeal and soyoil shipments are added to the bean export number, revenues reached $15.6 billion or 19% higher than the year before

Brazil's excellent first-half export performance has been fueled by a record crop, an improvement in port logistics and firm demand from China.

Buoyant first-half soybean prices have contrasted with weakness in quotes for iron ore, which is also principally shipped to China.

As Brazil goes deeper into the inter-harvest period, soybean shipments will subside and iron ore will likely end 2014 as the No. 1 shipment.

But, at a time when Brazil's trade balance is under strain, the industry becomes more and more important to the economy.

Without the $83 billion that agribusiness contributed to the 2013 trade balance, Brazil would have run an $80 billion trade deficit last year. Of that total, Brazilian soy complex exports totaled $31 billion.

The soybean has been transformational in the south and center-western Brazil over the last thirty years. It is now having a significant impact on the wider Brazilian economy.

The opening of new export corridors through northern ports over the next few years will certainly allow grain shipments to grow. However, a real boost to development would come from the expansion of Brazil's world-leading animal protein sector into the center-west. Despite the abundance of raw material in this region, the industry, for the moment at least, remains firmly based in the south.

(AG)

Posted at 2:34PM CDT 06/13/14
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