BUENOS AIRES (Reuters) - Argentina purchased an additional 120,000 tonnes of soybeans from the United States on Wednesday after buying the same volume on Tuesday, unusual moves that have prompted prices of the oilseed on local markets to fall.
The purchases, which sources said were made by local oilseed processor Vicentin SAIC, mark Argentina’s largest soybean imports from the United States in 20 years, showing the impact of a prolonged drought on the South American country, which is the world’s No. 3 exporter of raw soybeans.
The U.S. Department of Agriculture said both sales were registered for the 2018/19 marketing year, which begins in September. Tuesday’s announcement contributed to a rise in soybean futures on the Chicago Board of Trade, where traders are also concerned about China’s plans to place tariffs on U.S. soy.
But the moves had the opposite impact in Argentina, where prices had previously been rising because of the drought. Prices on the Rosario grains exchange fell 3.1 percent to 6,200 ARS ($307.46) per ton on Tuesday and fell an additional 100 pesos on Wednesday.
The drought has prompted crushers in Argentina, the world’s No. 1 exporter of soymeal and oil, to scramble for supply of raw soybeans. A source at Vicentin, who spoke on the condition of anonymity, told Reuters the company had made the Tuesday purchase.
“For us, it is one more source of supply. If it is convenient for us and it makes sense, we do it,” said the source.
An Argentina-based grains trader said the Wednesday purchase was likely made by Vicentin as well because it was the only company with the port capacity to unload soybeans, in a country far more accustomed to exporting them.
Vicentin is the South American country’s top exporter of soy oil, accounting for 15 percent of the 4.8 million tonnes Argentina exported last year.
Argentine crushers are likely to make further purchases of soybeans to make up for the impact of the drought, said Jim Sutter, chief executive of the U.S. Soybean Export Council.
“Argentina had a poor crop and they are providing more demand for the U.S.,” Sutter said. “It’s a positive development.”
Additional reporting by Michael Hirtzer in Chicago; Writing by Luc Cohen; Editing by Alistair Bell