The high level of capitalization of soy producers in Brazil, driven by record exports and the exchange rate, already leads to the acquisition of fertilizers for the 2021/22 harvest, which will be planted at the end of next year, in a rare movement of anticipation as well. to escape any uncertainties related to the coronavirus. “The exchange ratios are favorable and, in this scenario, we have already noticed the first movements in the purchase of fertilizers for the 21/22 harvest in the Midwest,” Eduardo Monteiro, Distribution Director of Mosaic Fertilizantes, told Reuters. The executive of Mosaic, a company that accounts for about 25% of the fertilizer market in Brazil, avoided saying how much he believes that fertilizer has already been negotiated for the 2021/22 harvest. This type of strategy occurred “very rarely” in Brazil, when the farmer found the opportunity to make a longer-term currency hedge, said the executive director of the Brazilian Agribusiness Association (Abag), Eduardo Daher, stressing that usually this anticipation of shopping involves more large soybean farmers. The first half of 2020 ended with very positive results for Brazilian soy producers, according to a survey conducted by consultancy Datagro. “Currently, especially in more professional agriculture, 50% of input purchases are made by the producer using his own resources. Before it was 30% with own resources, 30% financing and 30% by “barter” (exchange of inputs for grain)”, explained Daher.
Source: Reuters