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Montevideo, December 4th 2022 - 11:23 UTC

 

 

Brazil, a net wheat importer, has broken export records in 2021/22

Thursday, June 30th 2022 - 09:33 UTC
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Since the beginning of the Ukraine conflict at the end of February, the price of a wheat bushel reached US$ 12 in Chicago. The pre-war level was US$ 8 Since the beginning of the Ukraine conflict at the end of February, the price of a wheat bushel reached US$ 12 in Chicago. The pre-war level was US$ 8

Brazil, among the largest wheat importers in the world, --mainly from Mercosur associates--, is breaking consecutive export records in 2022. In less than six months, until June 20, Brazil exported more than twice as much wheat as in 2021, that is 2.5 million tons vis-a-vis 1.12 million tons in the whole year.

According to the news editor of Canal Rural, Giovani Ferreira, the appreciated dollar and the war between Russia and Ukraine are the main reasons behind such expansion. Together, the two countries are responsible for around 30% of the world wheat export market, some 210 million tons.

“The current market scenario in Brazil is the result of the war in Ukraine, which, as a side effect, increased the price of cereal on the whole planet,” he says.

With the conflict in Eastern Europe beginning at the end of February, the price of a wheat bushel reached the US$ 12 mark in Chicago. The pre-war level was US$ 8, and, currently, the cereal is priced at US$10.

In the domestic market,according to the exchange rate variable, prices went from R$95 per bag to R$120 per bag, “which helps explain the bullish market and unexpected food prices for chicken and pork farmers,” says Ferreira.

However despite the exceptional performance in exports, Brazil is currently the world’s fourth-largest wheat importer, with 6.2 million tons imported in the past. Brazil's industry consumes

on average some 12 million tons annually, and is benefitting from a record wheat crop harvest and yield..

“The crop is still being planted and depends on the weather how it grows. More than 80% of Brazil’s wheat supply is concentrated in the Southern Region, especially in the states of Paraná and Rio Grande do Sul. The expectation is to harvest between 8.5 million and 9 million tonnes. But what if the weather doesn’t help? We may have a supply problem,” said Ferreira who nevertheless believes wheat is rapidly becoming a most valued winter crop by farmers, and will eventually harvest sufficient to cover domestic market and have an export surplus. .

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