Brazilian pulse exports to China and 2024 bean production/
7 insights with Arbaza’s Eduardo Balestreri

Eduardo on… trade with China

• A major development came up with China during the G20 meeting, where we signed a landmark trade agreement with Xi Jinping that will open the Chinese market for Brazilian sesame exports. 
• This could significantly impact our pulse production areas as farmers may shift their planting decisions.
  
  

…export growth and market developments

• Our black matpe exports have seen remarkable growth, increasing from just 2,000 tonnes in the first year to 40,000 tonnes currently, with expectations to reach 50,000 tonnes this year. 
• The growth has been driven by our comprehensive support system for producers - we provide seeds, guarantee purchase prices, offer advance payments, supply chemicals, and provide technical support.
• The red bean market has also been strong, with prices exceeding $2,000 per tonne. The demand comes primarily from Europe, Turkey, and Israel. Unfortunately, we can't sell to China yet as the market isn't open for any type of beans.
  
  

…black bean markets 

• We've achieved a historic milestone with 78,000 tonnes of black bean exports, marking the first time our exports exceeded imports. Arbaza led the charge with 33,000 tonnes.
• This success stemmed from several factors: crop failures in Mexico and the United States combined with Brazil's consistently reducing first-harvest plantings by 5% annually. 
• Record-high prices in January-February 2023, reaching $1,150 per tonne at producer level, led to the largest second-harvest planting area in recent history. Despite losing 70% of the Rio Grande do Sul crop to excessive rainfall, Brazil maintained strong export numbers. 
• However, current market challenges include significant increases in freight costs to the Americas, making exports unfeasible despite existing orders at previous price levels. Looking ahead, the sector expects a 30% increase in first harvest compared to the previous year, though uncertainty remains due to potential weather risks during the rainy harvest period.
  
  

…the market comparison between black matpe and brown eye beans

• The contrasts are striking. Take brown eye beans - it's a 70-80,000 tonne annual market in India, where we supply 50-70% of consumption. Compare that to the Black Mung market, which is 2.8 million tonnes annually. 
• These size differences significantly influence our production decisions. There’s also the price difference of $100-150 between brown eye beans and black matpe
  
  

… projections for the upcoming black bean harvest

• We're looking at a 30% increase compared to last year's first harvest. However, we're cautious because the harvest occurs during the rainy period. We only count the crop when it's safely in storage - even after the 90-day cycle, rain can still destroy the harvest.
• Current freight costs to the Americas have made exports unfeasible and market prices in Brazil are falling
  
  

…the domestic market

• The carioca bean market represents 60-70% of Brazilian domestic consumption but remains a small part of our business. It's been more stable than black beans, which is unusual. 
• The market has seen some pivot irrigation plantings, but the major increase has been in black beans rather than carioca.
  
  

…green mung beans

• Brazil has exported only 8,000 tonnes this season, with estimated stocks of 2-3,000 tonnes. At Arbaza, we made a strategic decision not to produce green mung this year, focusing on other products instead.