Isaura Daniel*
São Paulo – The Arab countries are increasing their soy imports from Brazil. Between January and July this year, the Arabs purchased 219,000 tonnes of Brazilian soy in grain, the same volume as sold throughout the whole of last year. When compared to the first seven months of last year, when the country sold 77,000 tonnes of soy to the Arab world, the increase was 185%. According to the secretary general at the Arab Brazilian Chamber of Commerce, Michel Alaby, the Arabs are diversifying their suppliers due to the high global demand for the product, caused by China.
The Arab countries that purchased Brazilian soy this year were the United Arab Emirates, which purchased 142,000 tonnes, and Morocco, which imported 77,000 tonnes. According to Alaby, soy is used in the food industry in the Arab world, but part of the product shipped to the Emirates is also reexported. The country is a large supplier in the region. Last year the Arab buyers of Brazilian soy were Morocco, which purchased 131,000 tonnes, the Emirates, with 52,000 tonnes, Egypt, with 35,500 tonnes and Saudi Arabia, with 450 kilograms.
The Brazilian states that most shipped soy to the Arabs this year were, in terms of volume and in this order, Rio Grande do Sul, Paraná (both in the south of the country) and Goiás (in the midwest). Last year the main suppliers were Mato Grosso (also in the midwest), Goiás and Paraná. Between January and July this year, Brazil had revenues of US$ 52 million with soy sales to the Arab world, against US$ 16 million in the same period last year. In the whole of 2005, revenues were the same as in the first seven months of this year: US$ 52 million. Last year, Brazil exported 22.4 million tonnes of soy in grain, which generated revenues of US$ 5.3 billion.
According to João Paulo Moraes Filho, a manager at the National Food Supply Company (Conab), the forecast is that the country should export 24.5 million tonnes of soy in grain up to the end of this year. Up to mid August, exports had already totalled 18 million tonnes. In the 2005/2006 harvest, which ended in the first half of the year, Brazil picked 53.43 million tonnes, a reduction of 18 million tonnes, and figures for the next harvest are still uncertain, as producers are not very stimulated due to low prices of the commodity.
Less soy
According to Moraes Filho, there should be a reduction in the area in which the commodity is planted when compared to the previous harvest, when 22.2 million hectares were used for planting soy. There are not yet harvest forecasts, but, according to the Conab manager, there may even be an increase in production depending on the productivity of the crops. In the last harvest, for example, there was an 8.8% increase in productivity. Apart from low soy prices, the reduction in the planted area may also occur due to farmer debts and to the expansion of areas on which sugarcane and cotton are being grown, as these crops are currently considered more profitable.
According to Moraes Filho, there is being a reduction in the growth of the global market, which has caused prices to drop. This is partly due to sanitary products with pork and poultry, which reduce the production of these products and, consequently, reduce the global consumption of soy chaff. According to the manager at the Conab, soy prices should remain stable up to the end of next year, as there are no offer problems. "Offer is fine," he said. Argentina, which sows and harvests at about the same time as Brazil – planting in the second half and harvesting in the first half of the following year – should not reduce the area in which soy is grown, and the United States are getting ready for a good harvest.
*Translated by Mark Ament
