Brazil's soybean meal prices lag behind Argentina's

Brazilian soybean meal prices have recently fallen below those of Argentina for the first time in a month, driven by softer domestic demand and seasonally high crushing rates.

This shift is unusual, as Brazil typically commands higher prices due to its geographical and logistical advantages.

Platts, part of S&P Global Commodity Insights, assessed the FOB Paranaguá price for December delivery at $363.32/mt, $1.10 lower than Argentina's FOB Up River price on Oct. 18. By Oct. 21, the price gap widened to $2.20/mt, marking the first drop below Argentinian prices since Sept. 16.

Industry sources attributed this decline to a reduced buying appetite in Brazil over the past days, with local feed producers reportedly well-stocked. Year-to-date average FOB prices were approximately 20% lower than in 2023.

Additionally, strong soybean crushing rates were exerting pressure on export prices.

The Brazilian oilseeds crushers association, Abiove, reported on Oct. 17 a soybean crush of 4.36 million mt for August. This figure represented 90.7% of Brazil’s total crush, indicating that the national industry crushed 4.82 million mt of soybean in that month.

The volume surpassed expectations of 4.77 million mt, with Commodity Insights analysts noting that "the demand for soybean oil in biodiesel production" has been supporting the crush this year, as detailed in the Weekly Soybean Complex report issued on Oct. 18.

A supportive factor for traders is the possible delay in the EU Deforestation Regulation implementation, which would benefit Brazilian suppliers.

The EU Council recently agreed to postpone the EUDR by 12 months, starting Dec. 30, 2025, for large operators and traders, and until June 30, 2026, for micro and small enterprises. The European Commission has already voted for this delay, pending approval from the EU Parliament, which is expected by mid-November, according to industry participants.

When the EUDR is implemented, EU-based importers would be required to provide verifiable information to show that commodities, such as soybeans, were not grown on land deforested after 2020 and were cultivated in accordance with local laws.