Despite Improved Production, Trade Projects Brazil Will Buy from U.S. Again

Due to a significant domestic production shortfall, Brazil’s 2015-16 dry bean imports increased by 62% to 256,942 MT.  With both Argentina and China experiencing their own production shortfalls, the U.S. was able to establish a foothold in the Brazilian market with imports reaching over 18,000 MT according to USDA’s Trade database.

The Brazilian Agricultural Supply Corporation (Conab) estimates dry bean production in the first harvest season of 2017 will be at 1.283 MMT, up 24% from last year. This has been revised upward and is now estimated to be 36% higher than the year before, reaching 1.413 MMT. Carioca beans dominate, with an estimated 861,000 MT (up 29% from last year) and black beans are estimated at 319,400 MT (up 10% from last year. Compared to last year, Conab expects a higher area and production for the second harvest, which is currently being seeded. In the Parana area, which is the center of black bean production, the second season is expected to have higher production than last year. Producers were told not to plant soybeans due to disease issues. Therefore the local industry expects black bean seeding will be high.

Despite the improved outlook for Brazilian bean production, Marcelo Luders, President of the Brazilian Bean Institute (IBRAFE), projects that carioca bean supplies will get tight around April-May, 2017, and again in October 2017. He also noted that he believes there will be sufficient supplies of black beans until October.   USDBC’s work in Brazil in 2015 -2016 resulted in the first shipments of U.S. dry beans to this market due to a unique situation where extremely challenging weather conditions for Brazil and its traditional suppliers created a strong demand for imports from other origins.  However, with proper planning and market knowledge, USDBC and Mr. Luders believe that Brazil will buy beans from the U.S. on a seasonal basis.  According to Mr. Luders, the key to the “Brazilian market is to deliver in the months when stocks are low.  That requires pre-planning since it takes 45 days for U.S. beans to reach Brazilian ports from U.S. plants/warehouses.  China, for example, holds its beans in warehouses at the port and therefore is able to reduce the shipping time, making it 45 days or less.”  USDBC will continue to work to keep U.S. dry bean exports flowing to Brazil. The chart below shows the time of year when black bean stocks run low.