Cash strategist
Author
Published
5/26/2020
The Brazilian soybean harvest is wrapping up, and as it does, soybeans from that country are being offered at a sizable discount to the United States.
At times, we have seen soybeans from Brazil reach a 40-cent-per-bushel discount to the U.S. This divergence is due to a variety of reasons, with an overall improvement in the country’s ag industry being a primary one.
One reason Brazil can offer soybeans at a discount to the United States is improvements to the country’s infrastructure. The main one has been the paving of BR163, the main transit route from northern production regions to southern ports. BR163 is over 1,000 miles long and was initially a little more than a dirt road.
Once Brazil’s soybean production started to expand, this route saw a considerable build in traffic that it wasn't meant to handle. As a result, it would take weeks for trucks to make it from the north to southern ports and cost a farmer...
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