The market awaits today the arrival of the dollars that agriculture will begin to liquidate

FILE PHOTO. Traders look at financial data on computer screens on the trading floor of IG Index in London, UK. February 6, 2018. REUTERS/Simon Dawson

The United States holiday prevented the markets from operating fully, but there are already signs that the sale of soybeans is going to be more than four times what is usual in the next 24 or 48 hours for an amount of USD 250 million. The volume traded physically, but not settled in the wholesale exchange market, more than quadrupled that of Friday, but it was not reflected in the exchange market because the system was not yet updated, according to the official explanation.

“In the soybean dollar there were no operations, but there were in the physical where collectors, producers and other agricultural sectors intervene. There they operated at the new values ​​of between $70,000 and $73,300 per ton, which are equivalent to values ​​between USD 362 and 365. The market was very volatile both for fixings (merchandise delivered but not yet priced), as well as for new businesses,” said Salvador Vitelli, a public accountant who specializes in finance and agribusiness.

“What caused unease in the sector is that at the opening, exports set a price of USD 20 lower than that of Friday. This compulsive reduction was not justified because the closing on Friday in Chicago had been higher and at the local opening on Monday (a holiday in the United States) the offer was not yet present. Then there began to be more supply and imports raised their prices to $72,500 and in that band the bulk of the operations were madeVitelli added.

Regarding the volume negotiated, in the agro-export sector they assure that on Friday 68 thousand tons had been negotiated and with the implementation of the new regime the volume increased to about one million tons, which gives an estimate of USD 350 million taking the value of Friday in Chicago of USD 597 per ton and subtracting the expenses that the FOB has.

The truth is, due to the absence of agriculture and the United States holiday, businesses in the wholesale market fell to USD 277 million. The wholesale dollar had an increase from $1.23 to $140.28, which gives an effective annual devaluation rate of 80.5% because it exceeded -including the holiday on Friday- the rate of 30 cents per day of devaluation.

In the financial dollar market, the absence of the main reference market in the world was felt and it operated USD 98 million, less than half the volume.

The bonds used to carry out these operations, the AL30D and the GD30D, had rises of up to 4.6%, causing the MEP to fall $7.54 (-2.7%) to $271.19. Cash with settlement fell $5.83 (-2%) to $282.91. The “blue”, in turn, fell back $15 to $280.

The country risk remained at the level of Friday when the debt bonds were only traded abroad.

The stock market was also affected by the United States. $937 million in shares were traded. The S&P Merval, the leading index, rose 1.46% in pesos and 3.5% in dollars.

Reserves were affected by the 0.40% drop in the yuan and the sale to importers of USD 9 million by the Central Bank. In this way, they lost USD 68 million and remained at USD 36,573 million.

Today the market will be fully operational and maybe Monday’s soybean trades can be liquidated if the system starts working. The measure of granting one dollar to $200 to the soybean complex was well received by the market and was reflected in the decline of the dollar. But attention: once the producers get hold of the pesos there may be coverage with the MEP dollar or counted with liquidation and the prices will not be the same.

KEEP READING:

“Soy dollar”: due to lack of time to adjust systems, there was no liquidation of agriculture on the first day
The free dollar fell to $270 due to the expectation of foreign currency income from agriculture and the gap was below 100%
Total cut of Russian gas: the stock markets collapse and the euro fell to the minimum in 20 years against the dollar
Financial dollars: why the drop in the MEP price bodes well for the “soybean dollar”
Markets: the Stock Market rose in a wheel bounded by the holiday in the US

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