FORT COLLINS: Troubles in South America could give US soybean exports a lift in the near term, but top importer China is already thinking ahead to next year and booking cargoes of the upcoming US harvest.
Chinese interest in new-crop soybeans is not uncommon for the date, but the recent sales are a bit larger than in most years.
It is premature to pinpoint export levels for 2022-23, which starts in September, though new-crop sales are respectable thus far due to activity from the traditional buyers: China for soybeans and Mexico for corn.
China and unknown buyers may have bought up to 1.9 million tonnes of new-crop US soybeans in January, well above average, down from last year’s high near 3 million and similar to 2014.
But for other destinations, new-crop soybean sales near 100,000 tonnes as of Jan. 27 are closer to normal and well below the anomalous year-ago levels near 500,000 tonnes. Last year’s early activity included more aggressive purchases from European buyers in addition to the Chinese.
US soybean sales for 2022-23 totaled 2.08 million tonnes through Jan. 27, including nearly 882,000 tonnes in the latest week alone.
For many analysts, Brazil’s anomalous soybean crop losses almost guarantee that US exporters will pick up at least some old-crop business, though volumes are debated. The top exporter’s harvest woes may not be apparent in early shipments that originate in central and northern Brazil, where soybean crops have been successful.
Those first exports are starting up now, but beans in the drought-crippled south are shipped primarily in April and May. Shipped Brazilian beans are still a better deal right now for buyers than US ones, but their advantage is much slimmer than a year ago, perhaps increasing chances for US exporters down the road.
As of Jan. 27, US Department of Agriculture data showed total 2021-22 US soybean export sales at 45.2 million tonnes, some 81% of the agency’s January full-year forecast. That compares with 96% a year ago and a 10-year average of 84%.
Traders are expecting USDA next Wednesday to reduce US 2021-22 soybean ending stocks by 40 million bushels to 310 million, likely reflecting that increases to either exports, crush, or both will total 40 million bushels.
CORN
USDA’s Thursday notification that China had cancelled 380,000 tonnes of old-crop US corn was not the news corn bulls wanted to hear. That is the largest single-day US corn cancellation from any buyer in at least seven years.
China’s future demand intentions have been unclear for a while, but the amount of time since its last major US purchase is approaching an uncomfortable nine months. USDA’s Beijing attache and China’s agriculture ministry both peg 2021-22 Chinese corn imports at 20 million tonnes versus last year’s figure of near 30 million, though USDA’s official view is higher at 26 million.
Final 2020-21 US corn sales to China totaled 22.5 million tonnes, but the balance had once been as high as 23.4 million, showing precedent for this week’s cancellation. Through Jan. 27, sales to China for 2021-22 totaled 12.4 million tonnes, well below the year-ago 17.7 million and the eventual marketing-year final. China has no US corn on the books for 2022-23, but its 2021-22 purchases did not begin until May 2021.
US exporters as of Jan. 27 had sold 1.45 million tonnes of corn for 2022-23, an eight-year high for the date. Almost all that stems from record sales to traditional top buyer Mexico. In most years, US corn customers do not accelerate new-crop bookings until June or July.
Total 2021-22 corn sales as of Jan. 27 stood at 45.1 million tonnes or about 73% of USDA’s target, better than the 10-year mean of 66% but below last year’s 85%.