Macro Market Surge Supportive to Commodities

Published on: 08:45AM Apr 07, 2020

Corn Exports are Picking up  

  • After a very slow start to the 2019/20 marketing year, U.S. corn export sales have improved impressively over the last few months.
  • U.S. corn export sales during January-March averaged 43.9 million bushels/week, up 22% over the 35.8 million/week during the same period last year.
  • Corn exports, for the week ended 4/02/20, were a new high for the 2019/20 marketing year at 50.1 million bushels.
  • Exports were solidly above the 40 million bushels/week needed to reach the USDA's 1.725 billion bushel export projection.
  • Brazil is waiting for the harvest of the second crop before exports can increase again from August forward.
  • FBN’s Take On What It Means For The Farmer: As a result of a very slow start, cumulative export inspections of 761 million bushels for the year to date are still down 37% from last year's 1.210 billion bushels. While the recent overall sales pace may keep USDA from lowering its export forecast in  Thursday's report, FBN is not confident that USDA’s current export forecast will be reached by the end of the marketing year.  While exports have been encouraging recently, it may not be enough to turn prices higher, given the weakness in prices from an ethanol standpoint, but do represent a supportive part of the demand picture.   

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Soybean Exports Continue to Lag 

  • Soybean exports for the latest week were at a marketing year low of 11.0 million bushels.
  • There were no shipments to China this week and outstanding sales are only 12.3 million bushels.
  • Through March total export commitments are 1.354 billion bushels, down 15% vs 1.601 billion last year.
  • Soybean exports will need to average roughly 27.6 million bushels/week, vs last year's 27.2 million/week average to reach the USDA's last annual export estimate of 1.825 billion bushels.
  • FBN’s Take On What It Means For The Farmer:  With the uncertainties surrounding the Chinese Phase 1 purchase plans and potential shipping/logistical issues out of South America, it’s possible importers could return to the US in the second half of the marketing year. However, the export pace would need to be more than twice as strong as the 5-year average to reach USDA’s current export projection. FBN expects that USDA eventually will have to reduce its US export forecast.


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