Late Season Exports and New-Crop Sales Reflect Record U.S. Soybean Export Forecast for 2017/18

The U.S. soybean export forecast for 2017/18 is projected to exceed this year’s record volume as low prices and ample supplies continue to drive export sales. U.S. export volume for the May to August period was significantly above historic levels, and similar to the quantities attained in 2016 when supplies in Brazil were more limited. Additionally, new-crop sales, which started slowly, have picked up the pace in the last few weeks; matching last season’s accelerated pace.

The strong late-season exports and new-crop sales have occurred at a time of large third-quarter exports by Brazil, a reflection of the record 2017 harvest, as well as an expectation of significant October 1 stocks. While the Brazilian dynamic is similar to the situation in 2015, a key difference is that the United States is not facing a weakening real that allowed Brazilian beans to be priced more competitively. With large supplies available in Brazil and the United States, coupled with a stronger real, U.S. soybeans have remained competitive in export markets.

Given the ability of U.S. soybeans to remain competitive prior to harvest, there is nothing to indicate the situation will change post-harvest.

OVERVIEW

2017/18

Global oilseed production is forecast higher this month to a record 579.0 million tons. Soybean production is boosted this month as larger output for the United States and Bolivia more than offsets reductions in Uruguay and Serbia. Cottonseed crop prospects are raised for India, Brazil, and the United States. Sunflowerseed production forecast is up for Argentina, Turkey, and the European Union and offsets reductions for Bolivia and Ukraine. The forecast for rapeseed production in Canada is lowered and more than offsets gains in Russia. Global soybean imports are up this month on gains for China and Thailand that exceed reductions for the European Union, South Africa, and South Korea. Exports are raised on larger projections for the United States. Global soybean stocks are down this month following reductions in Brazil’s carryin supplies. The U.S. season-average farm price for soybeans is down $0.10 this month to $9.20 per bushel.

2016/17

Global oilseed production is raised this month. The rapeseed production estimate is boosted for Canada and more than offsets reductions in Uruguay’s soybean crop. Global soybean imports are up on larger shipments to China and Thailand exceeding reductions to the European Union, South Africa, and South Korea. Exports are forecast higher this month on larger shipments from Brazil exceeding reductions for Argentina, Ukraine, and Uruguay. The U.S. season-average farm price for soybeans is unchanged this month at $9.50 per bushel.

SOYBEAN PRICES

U.S. export bids in August, FOB Gulf, averaged $372/ton, down $11 from July. FOB Brazil Paranagua averaged $378/ton, down $10. FOB Argentina Up River averaged $368, down $10. Following improved precipitation and cooler temperatures in the United States through August, prices have trended lower. Abundant global supplies of soybeans are likely to pressure prices.

For the week ending August 31, U.S. 2016/17 soybean export commitments (outstanding sales plus accumulated exports) to China totaled 36.7 million tons compared to 30.1 million a year ago. Total commitments to the world are 60.5 million tons, compared to 52.8 million for the same period last year.

2017/18 OUTLOOK CHANGES

  • United States
    • Soybean exports are up 680,000 tons to 61.2 million.
    • Palm oil imports are up 125,000 tons to 1.4 million.
  • Argentina soybean oil exports are up 100,000 tons to 5.9 million as processors shift oil to food use away from fuel use.
  • China
    • Soybean imports are boosted 1.0 million tons to 95.0 million in line with changes in 2016/17 and raised protein meal demand forecast.
    • Peanut imports are lowered 100,000 tons to 400,000 in line with reductions for 2016/17.
  • European Union
    • Sunflowerseed meal imports are down 100,000 tons to 3.9 million, following a larger sunflowerseed production estimate.
    • Soybean imports are down 100,000 tons to 14.5 million in line with reductions for 2016/17.
  • India soybean oil imports are down 100,000 tons to 4.1 million, and palm oil imports are lowered 100,000 tons to 9.4 million on higher tariffs for select vegetable oils.
  • Malaysia palm oil exports are up 100,000 tons to 17.3 million on larger production.
  • South Africa soybean imports are slashed 175,000 tons to 50,000 in line with reductions for 2016/17.
  • Thailand soybean imports are up 250,000 tons to 3.2 million and soybean meal imports are down 150,000 tons to 2.8 million, both in line with trade changes for 2016/17.
  • Ukraine sunflowerseed meal exports are down 100,000 tons to 4.7 million and sunflowerseed oil exports are reduced 150,000 tons to 5.3 million, following a lower sunflowerseed production estimate.
  • Uruguay soybean exports are cut 450,000 tons to 2.4 million, following a lower production forecast.

2016/17 TRADE CHANGES (on trade data unless specified otherwise)

  • United States
    • Soybean exports are up 545,000 tons to 59.1 million.
    • Soybean meal exports are raised 136,000 tons to 10.7 million.
  • Argentina
    • Soybean exports are cut 500,000 tons to 6.5 million.
    • Soybean meal exports are up 250,000 tons to 31.3 million.
  • Brazil
    • Soybean exports are boosted 1.5 million tons to 62.5 million.
    • Soybean meal exports are cut 400,000 tons to 13.9 million.
  • China
    • Soybean imports surge 1.0 million tons to 92.0 million.
    • Fish meal imports are up 200,000 tons to 1.3 million.
    • Palm oil imports are down 300,000 tons to 4.6 million, while soybean oil imports are lifted 100,000 tons to 720,000.
  • European Union
    • Soybean imports are lowered 300,000 tons to 13.5 million.
    • Sunflowerseed meal imports are down 100,000 tons to 3.8 million, while sunflowerseed oil imports are up 100,000 tons to 1.6 million.
  • India soybean meal exports are up 100,000 tons to 1.8 million.
  • Iran sunflowerseed oil imports are raised 100,000 tons to 450,000.
  • Iraq sunflowerseed oil imports are lifted 140,000 tons to 550,000.
  • South Korea soybean imports are down 150,000 tons to 1.2 million.
  • Peru fish meal exports are up 175,000 tons to 900,000.
  • Russia sunflowerseed meal exports are reduced 100,000 tons to 1.4 million, while sunflowerseed oil exports are up 100,000 tons to 2.1 million.
  • South Africa soybean imports are slashed 150,000 tons to 50,000.
  • Thailand soybean imports are up 100,000 tons to 3.2 million, while soybean meal imports are cut 100,000 tons to 2.7 million.
  • Ukraine
    • Soybean exports are down 100,000 tons to 2.9 million.
    • Sunflowerseed oil exports are boosted 250,000 tons to 5.7 million.
  • Uruguay soybean exports are down 200,000 tons to 2.9 million, following a lower production estimate.