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Soy and sugar traders are fighting for room in Latin America\u2019s largest port, rushing to secure loading slots as the slowest Brazilian soy harvest in 10 years pushes the grains export window into the sugar season.<\/p>\n
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Congestion was hitting Brazil\u2019s Santos port just as consumers worldwide have been turning to top exporter Brazil for sugar and soybean supplies. The glut of shipments waiting to leave is boosting transport costs and will likely delay arrivals at destinations.<\/p>\n
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Sugar prices hit a four-year high late last month, boosted by supply tightness. Soybean prices, already near seven-year highs, could rise further at a time when Brazil is effectively the world\u2019s main supplier.<\/p>\n
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\u201cIt is a perfect storm, a combination of factors that are leading to soy and sugar to compete for logistics,\u201d said Tiago Medeiros, Brazil head and executive director for Czarnikow Group, a food trader and supply chain services provider.<\/p>\n
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Brazil usually starts soybean exports in January, with volumes increasing in later months. This season, planting was delayed, as was the harvest, pushing that window further out.<\/p>\n
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Shipments from the new sugar crop usually start around April, but companies are still shipping stocks from a bumper crop in 2020. Brazil\u2019s Agriculture Ministry saw sugar stocks at 7.3 million tonnes in mid-February, the highest for the last three years.<\/p>\n
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Market players expect growing delays in coming months, with ships likely waiting several weeks before being able to dock in Santos.<\/p>\n
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Medeiros noted that spot prices for both sugar and soybean futures are higher than deferred ones. This inverted chart position signals near-term supply tightness, he said, which could mean financial losses for sellers if they fail to deliver on time.<\/p>\n
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\u201cSo everyone wants to get products out as soon as possible,\u201d he said.<\/p>\n
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Most crops in Brazil are moved by truck, so truck freight costs spiked due to the rush of goods.<\/p>\n
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Traders said shipowners sharply raised demurrage, the daily fee charged for port delays, from around $18,000 per day to $30,000 per day on trips to Brazil.<\/p>\n
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Because of long vessel waiting times, French trader Sucden said India might be an alternate sugar supplier, but traders said its supply is constrained for several reasons.<\/p>\n
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\u201cBrazil mainly exports raws, while India has surplus of whites. So direct substitution is limited,\u201d said a source at a large sugar trader in India.<\/p>\n
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Soy options<\/strong> The U.S. Department of Agriculture forecast soybean stocks at the Aug. 31 end of the 2020\/21 marketing year at 120 million bushels, down sharply from 525 million a year earlier. It would be the smallest ending stocks since 2013\/14.<\/p>\n maritime professional<\/p>\n","protected":false},"excerpt":{"rendered":" Soy and sugar traders are fighting for room in Latin America\u2019s largest port, rushing to secure loading slots as the slowest Brazilian soy harvest in 10 years pushes the grains export window into the sugar season. Congestion was hitting Brazil\u2019s Santos port just as consumers worldwide have been turning to top exporter Brazil for sugar …<\/p>\n","protected":false},"author":1,"featured_media":26458,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[64],"tags":[6189,4040,1320,2870,953,15141,3542],"class_list":["post-26457","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-maritime-news","tag-brazils","tag-congestion","tag-largest","tag-leaves","tag-port","tag-scrambling","tag-traders"],"_links":{"self":[{"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/posts\/26457","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/comments?post=26457"}],"version-history":[{"count":0,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/posts\/26457\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/media\/26458"}],"wp:attachment":[{"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/media?parent=26457"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/categories?post=26457"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/tags?post=26457"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
Chinese soy buyers would normally turn to the United States to avoid Brazilian congestion, but U.S. farmers have little to offer. Due to strong demand, the United States will only have about 10 days worth of soybean supplies before the U.S. harvest starts in September.<\/p>\n