The United States Seizes Opportunity to Expand Foreign Soybean Meal Sales

Through the first half of the marketing year, robust US soybean meal exports have offset slower sales from South America. U.S. exports in January climbed to their highest level ever with accumulated foreign sales through March rivaling the record pace set in 2009/10. This opportunity occurred because of a slowdown in Brazilian and Argentine crush that was precipitated by last season’s drought and slower than expected recovery in early 2013.

However, U.S. exports are forecast to drop sharply in the coming months as new crop South American soybean meal enters the market at the same time U.S. supplies are being depleted. Already, there are reports that some processors will have to temporarily suspend operations because of the scarcity of soybeans.

OVERVIEW

Global soybean production is raised, supported by larger crops in Paraguay and Uruguay. Global trade is lower, driven by reduced exports from Brazil and Argentina, negatively impacting China’s imports. World imports for soybean meal and oil are down due primarily to a slower recovery in South American crush following last year’s drought. The season-average U.S. farm price remains unchanged. 

SOYBEAN PRICES 

U.S. export bids, FOB Gulf, in March averaged $562 per ton, down nearly $10 per ton from the previous month. Prices remain above historic levels as strong demand, tight U.S. supplies and a slow recovery in Brazil’s exports continue to provide support. 

As of the week-ending March 28, U.S. soybean commitments (outstanding sales plus accumulated exports) to China totaled 21.8 million tons compared to 20.9 million a year ago. 

Total commitments to the world are 36.1 million tons, compared to 31.7 million for the same period last year. 

2012/13 TRADE OUTLOOK

1. U.S. soybean exports are raised 136,000 tons to 36.7 million with meal exports up 408,000 tons to 8.5 million, reflecting the strong pace of sales to date. 

2. Argentina’s soybean exports are cut 550,000 tons to 10.4 million and soybean meal exports are down 980,000 tons to 26.0 million as exportable supplies remain tight.

3. Brazil’s soybean exports are slashed 1.7 million tons to 36.8 million, while soybean meal exports are down 925,000 tons to 13.8 million as logistical challenges hinder new crop shipments and crush. 

4. China

Soybean imports are cut 2.0 million tons to 61.0 million reflecting a slower pace of new-crop shipments by Brazil.

Rapeseed imports are up 300,000 tons to 2.1 million offsetting a decline in rapeseed meal imports; rapeseed oil imports are raised 250,000 tons to 1.0 million on larger purchases from 

5. Canada

Palm oil imports are up 100,000 tons to 6.5 million on strong purchases for October-February.

6. European Union

Soybean imports are up 200,000 tons to 11.8 million on stronger demand following price declines in advance of record South American production. Soybean meal imports are cut 500,000 tons to 20.0 million as crush and exports from South America are slow to recover, while soybean oil exports are raised 200,000 tons to 700,000 tons with larger shipments to North Africa. 

Rapeseed imports are cut 300,000 tons to 3.1 million in response to a larger 2012 harvest. 

Sunflowerseed meal imports are raised 200,000 tons to 3.5 million to partly offset the need for soybean meal. 

Palm oil imports are up 100,000 tons to 5.7 million on rising food use. 

7. India’s palm oil imports are raised 500,000 tons to 8.5 million as competitive world prices boost demand. 

8. Indonesia’s soybean meal imports are raised 320,000 tons to 3.5 million on larger purchases made from Argentina and the United States.

9. Indonesia’s palm oil exports are raised 500,000 tons to 20.1 million, and Malaysia’s exports are up 200,000 tons to 17.4 million on expectations of stronger demand in India, China, and the EU.

10. Mexico’s soybean imports are up 200,000 tons to 3.6 million on an expected larger crush.

11. Paraguay’s soybean meal and oil exports are up 450,000 tons to 2.1 million and 110,000 tons to 510,000, respectively, as additional crush capacity becomes available.

12. Russia’s sunflowerseed meal exports are up 140,000 tons to 1.1 million on stronger shipments to the EU (mainly Italy, Latvia, and Denmark.) 

13. South Africa’s soybean meal imports are cut 450,000 tons to 500,000 on expectations of larger domestic production as additional crushing plants are brought into operation. 

14. Uruguay’s soybean exports are raised 1.0 million tons to 2.9 million following production increases resulting from an expansion in soybean cultivation.

15. Vietnam’s soybean imports are raised 120,000 tons to 1.4 million and soybean meal imports are cut 200,000 tons to 2.1 million tons supported by increased crush.