South American weather and quality issues could extend soybean price rally
Soybean markets are gaining fresh momentum amid unfavorable weather conditions in South America and growing concerns over crop quality. Prices have already been supported by US President Donald Trump’s announcement that China plans to increase purchases of US soybeans.
Market attention is now shifting to Argentina, where dry weather is threatening crops, and to Brazil, the world’s largest soybean producer. In particular, heavy rainfall in Mato Grosso has disrupted harvest operations and raised concerns about the quality of the crop.
According to analyst Michael Cordonnier of Soybean and Corn Advisor, some areas of Mato Grosso received more than 500 mm of rain in January, delaying harvest and damaging soybeans. As of early February, Brazil’s soybean harvest is only about 16% complete.
Experts estimate that up to 30% of harvested soybeans are affected by quality problems, including mold, breakage, shriveling, and high moisture. Some farmers report that grain elevators are rejecting shipments that fail to meet export standards.
Against this backdrop, the Mato Grosso Institute of Agricultural Economics is considering cutting its latest soybean production forecast. Analysts warn that a combination of weather risks and quality losses could keep upward pressure on soybean prices in the coming weeks.
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