U.S. Soybean Export Program Showing Progress
- According to U.S. Census data during May the United States exported 2.56 MT of soybeans, -18% YoY, the second largest May volume on record. September through May exports totaled 35.8 million tonnes, -26%YoY, and the smallest volume for the period in six years.
- Approximately 50% of the May soybean exports went to China, the largest monthly volume since January 2018. Exports to China were 1.28 MT in May, while exports during the first nine months of the marketing year totaled 6.98 MT, -75% YoY.
- Soybean exports to non-Chinese destinations are slowing after a record setting pace that started last year. The 1.28 MT exported during May to buyers other than China was the smallest monthly volume in two years.
- USDA’s forecast for the 2018/19 crop year is 1.7 billion bushels, -20% YoY and the smallest total in five years. To meet the USDA’s export estimate, monthly volume for the balance of the marketing year should average a record pace of 3.5 MT.
- What It Means For The US Farmer: At FBN we believe that the U.S. soybean export program has been the beneficiary of periodic Chinese purchases of large volumes but remains vulnerable to cancellations despite these sales. While these sales to China are unquestionably encouraging, we believe that they continue to illustrate the dependence the U.S. producer still has on the Chinese as export sales to countries other than China remain lackluster.
U.S. Corn Exports Remain Sluggish
- U.S. Census data showed that May corn exports reached 4.7 MT which is the smallest monthly volume in six years.
- The USDA estimates 2018/19 U.S. corn exports at 2.2 billion bushels.
- During the final three months of the 2018/19 marketing year, U.S. corn exports must average 4.1 MT to meet USDA's current forecast. This monthly goal is well below the recent reported sales volume which has been lackluster during June.
- Weekly export inspection data implies that last month's shipments totaled about 2.5 MT through June 27. The 272,513 tonnes of corn inspected in the week ended June 27 were the smallest for any week in nearly six years.
- Monthly corn export volume from Argentina and Brazil have been at a record setting pace.
- What It Means For The US Farmer: At FBN we have been critical of the USDA’s export figures in the monthly WASDE since January. A bumper crop in Latin America combined with a strong dollar has presented headwinds for most of the 2018/19 marketing year. We believe that barring a global feed grain supply shock, the 2019/20 U.S. corn export program could bring another challenging export climate.
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