South America Calling

Brazil's official September grain export figures came out late Thursday, showing strong soybean shipments and surprisingly weak corn movement.

These numbers caused some puzzlement as ship line-up data for Brazilian ports indicated that shipments of the oilseed had given way to large volumes of corn during the last month as the second-crop harvest started hitting the market.

As with most things, the devil is in the details. The Ministry of Development, Industry and Commerce data only counts a shipment once all documentation is complete, which may only take place in the following month. So Brazil is still likely on course to export massive amounts of corn in 2015-16, possibly breaking the previous record set in 2013-14

"The government figures are a bit behind because of the bureaucracy, but they end up agreeing with the line ups in the end," said Sergio Mendes, executive director at the Brazilian Cereal Exporters Association (ANEC).

Brazil has been able to be super aggressive on the corn export market this year following the vertiginous slide of the real, which has lost 33% to the dollar this year.

According to the government data, Brazil shipped 3.46 million metric tons (mmt) of corn in September, up 29% on the year, while it exported 3.71 mmt of soybeans, up 39%.

However, according to figures compiled by ANEC based on ships leaving port, corn exports totaled 4.64 mmt while soybean exports reached 3.06 mmt.

These industry figures look more realistic as port operator data indicated there was over 5 mmt in corn in the queue to be shipped last month.

As such, Brazil remains on course to ship more than the 26.4 mmt forecast by the Agriculture Ministry and possibly reach the 30 mmt forecast by some exporters.

One concern is the ongoing farm customs inspectors' strike, which has the potential to delay grain shipments.

After two weeks of industrial action, it appears that the government has ceded to the inspectors union's demands on pay and career structure. But meetings continue on administrative issues.

ANEC's Mendes said he is hopeful the strike will end Friday.

"They appear to be negotiating issues on which it isn't appropriate to strike," he said.

All grain exports require certificates issued by farm custom inspectors but the strike action has not yet significantly affected soybean and corn shipments as the document is only needs to be presented once the cargo reaches its destination. Still, exporters are anxious.

(CZ)

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