By Tarso Veloso (Bloomberg) —
A backlog of vessels waiting to load soybeans from some Brazilian ports is stretching to near-record lengths as the world’s biggest bean exporter struggles to harvest and ship this season’s crop due to extreme weather.
Following harvest woes and heavy rains that have made it challenging to dry and transport the beans, some boats have now been waiting for more than 40 days for their cargoes. That’s significantly longer than the seven to 15 days that’s typical, resulting in longer lead times, higher premiums and rising costs for buyers.
“The lineup is growing when it should be going down in a clear message that not enough soybeans are making it to the ports,” said Marcos Pepe Bertoni, chief operating officer at Corredor Logistica e Infraestrutura SA at the Tegram grain terminal.
The shipping delays come as bad weather has battered this season’s crops, with heavy rains in Mato Grosso state delaying the harvest even more than anticipated since wet beans need to be dried before being hauled to ports. Although the state’s harvest is further along than it was at this time last year, it’s still behind where experts expected it would be.
The country is now expected to export only 7.2 million tons this month, according to grain-exporter group Anec, below the 9 million ton forecast made in January.
Those delays are showing up in markets, with both U.S. and Brazilian soybean prices climbing. South American prices are usually the cheapest in the world starting in February, when the harvest starts, until the fall harvest in the U.S., but the lack of available soybeans in Brazil has pushed those prices even higher.
Due to the multi-week queue for loading, some big trading companies are now withdrawing cargoes from Port of Santos and sending them instead to ports in the Northern Arc, such as Itaqui and Barcarena. Bertoni said most of trains heading to Santos are not able to fill more than 60% of the initial schedule, driving some of the vessels to switch ports.
© 2022 Bloomberg L.P.
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