Brazil’s suspension of soy tariffs has yet to significantly boost imports of the oilseed despite a lack of inventories, analysts told Reuters, as the market reacted cautiously due to the high cost of imports.
The Economy Ministry said on Saturday that it would suspend tariffs on corn and soy imports from countries outside the Mercosur trade bloc until early next year to help reduce food prices, which are contributing to inflation.
Brazil has run down its soy inventories this year by exporting to take advantage of high global prices and a weak real currency against the dollar.
“We practically don’t have soy and, with or without the (tariff), whoever can’t guarantee their stocks until the arrival of the new harvest in January will probably need to import,” said Daniele Siqueira, an analyst at consultancy AgRural.
“But the dollar is high and making imports expensive,” he added.
AgRural said it has not changed its projection of 800,000 tonnes of soy imports in 2020. Government data shows 528,000 tonnes were imported for January to September.
Rival consultancy Safras & Mercado sees the tariffs suspension possibly pushing soy imports to a maximum of 1 million tonnes this year, as compared with a current projection of 850,000, analyst Luiz Fernando Roque said.
But it’s not likely to go any higher than that, he said.
“There’s no reason for the industry to increase imports for now. In February, there should be large volumes of the new Brazilian crop hitting the market,” he said.
A large company in Brazil’s southern Rio Grande do Sul state bought 90,000 tonnes of soy from Uruguay in an order scheduled to arrive in November, reducing the need to import from the U.S. Roque said.