WASDE: US soybean exports give way to South America
Details regarding feed and grain crop production were included the US Department of Agriculture’s (USDA) December World Agricultural Supply and Demand Estimates report, which was released Tuesday.
Brennan Turner, president and CEO of FarmLead, said there was little in the report to address the weather situation in Argentina or across Latin America.
“They kept production where it was,” he told FeedNavigator.
There was not much expectation of a yield change for production in the US, he said. “On the US side I was watching for demand and we have seen slower soybean exports in 2017-18,” he added.
“It’s really the southern hemisphere; the 2017-18 production in the northern hemisphere is done, so for the next couple months we’ll be looking at South America and then thinking about 2018-19 acres,” he said.
However, there may be ongoing potential for producers looking for deferred movement into May or June 2018, he said. Current prices are low, and continue to be low, but futures sales into 2018 may offer better pricing for those looking to sell feed crops.
Corn and soy details
The US corn outlook called for increased corn use and a 50m bushel drop in ending stocks, said the USDA.
The ending stocks dropped for corn, and while that is slightly bullish stocks remain high, said Turner. “There’s a large amount of grain out there in the world we have to get through,” he added.
The season-average price saw its range narrow to $2.85 to $3.55 a bushel, the department said. However, the midpoint did not change.
Sorghum prices have increased relative to corn, as there have been some large purchases by China, the department said. With the increased exports, domestic use of the crop has lowered.
Globally, corn production is predicted to increase especially for China, the EU, Laos and Guatemala, the department said. Ending stocks also rose slightly from previous estimates to 204.1m tons.
Total domestic oilseed production is forecast to be 132.2m tons, the department said. However, soybean exports fell by about 25m bushels to 2.225bn bushels from increased competition with Argentina and Brazil in the first quarter.
The downturn in soybean exports from the US was not a surprise, said Turner. “We were expecting that, we know that from the daily number of exports,” he added.
“The key thing is half the world’s grain production is corn, and where you are seeing the demand growth is in oilseeds,” he said.
Biodiesel and related products are seeing increasing interest, which helps support prices and use, he added.
US ending stocks for soybeans in 2017/18 are expected to be 445m bushels, an increase of 20m from the previous estimate, said the USDA. The price range for soybeans also narrowed to $8.60 to $10, while soybean meal remained unchanged at $295 to $335.
Globally, oilseed production is looking for increased production, higher exports and a jump in ending stocks, the department said. Higher exports from Argentina and Brazil, along with rapeseed exports from Canada are informing that forecast.
Soybean stocks were increased by 0.4m tons to 98.3m, as a reduction in South American stocks was offset by an increase in the US, Canada and the EU.
Wheat numbers
Wheat ending stocks were increased by 25m bushels based on the drop in exports, said the USDA. The reduction is attributed to increased competition for crops from Canada.
The projected season-average farm price for 2017-18 continues to have a midpoint of $4.60 a bushel, while the overall range was narrowed to $4.50 to $4.70.
Globally, wheat supplies also grew with increased production expected for Canada and the EU balancing a drop in production for Brazil, South Africa and Yemen, the department said. Production in Canada is estimated to increase by 3m tons to 30m, while EU production was raised by 1m tons to 152.5m.
World trade for 2017-18 was increased for the month, the department said. Exports grew for Canada, Russia and Ukraine and dropped for the US.
Global ending stocks were increased to 268.4m tons, a new record, the agency said.
