SAO PAULO: Brazilian soybean farmers are keeping their crops instead of selling them because they expect prices to rise further as global supplies tighten, according to brokers, buyers and sellers in the world's largest producer and exporter of the oilseed.
Another reason for crop hoarding is the fear the La Nina weather phenomenon could limit the next crop in South America, farmers and brokers said. They also cited escalating domestic political tensions that could weaken the country's currency, the real, over the next few months.
Farmers hope to force exporters and the local processing industry to pay more. This, in turn, could feed international worries about food inflation by further boosting global soy and corn prices that hit eight-year highs earlier this year.
In southern states like Rio Grande do Sul and Paraná, farmers still have a combined 12.4 million tonnes of soybeans from the 2021 crop to sell, according to early August estimates from agribusiness consultancy Safras&Mercado. That represented about half of Brazil's nearly 25 million tonnes left from the 2021 cycle.
Luis Fucks, a farmer in Rio Grande do Sul, said growers are in no hurry to sell, and hope prices can reach $14 per bushel. Decio Teixeira, in the same state, said some growers are expecting quotes to return to 170 reais ($32.85) per 60-kilo bag before closing deals again, adding he kept "a large portion of his crop" to negotiate later.
La Nina typically brings dry weather to South America.
"Nowadays it seems having grains in the hand is safer than having a currency," Teixeira said.
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