USDA Projections Indicate Ample Soybean Supplies

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Friday, 17 July 2009 14:26

Urbana, Illinois, July 2009 – The July 10 USDA monthly report of U.S. and world supply and demand projections for major crops contained a number of changes from a month ago but generally points to abundant crop supplies for the year ahead, said a University of Illinois Extension economist. “For soybeans, the USDA increased its projection of both the domestic crush and exports during the current year by 10 million bushels,” said Darrel Good. Those increases were offset by an increase in the projection of imports and a smaller projection of residual use of soybeans. Year-ending stocks are still projected at 110 million bushels, he said. But the projection of 2008-09 marketing year soybean exports of 1.26 billion bushels could be exceeded, he noted. “USDA estimates place cumulative marketing year exports through July 2, 2009, at 1.145 billion bushels. Those estimates suggest that weekly shipments through August need to average 13.4 million bushels per week to reach the new projection of 1.26 billion bushels for the year,” Good said. “However, Census Bureau estimates through May 2009 exceed USDA estimates by 35 million bushels. If that margin persists, weekly shipments would need to average only 9.3 million per week. If all the bushels that were sold but not yet shipped as of July 2 are actually exported, exports for the year could be as high as 1.3 billion bushels,” he said. Exports at that level point to an unreasonably small year-ending inventory of 70 million bushels, he noted. “The recent drop in old crop soybean prices suggests that the market is not concerned about old crop supplies, even with a late-maturing crop. It now appears, however, that some additional rationing of old crop soybean supplies is needed or that the 2008 crop was actually larger than estimated,” Good added. For the 2009-10 marketing year, updated USDA projections reflect the larger soybean-planted acreage figure released on June 30. With a yield of 42.6 bushels per acre, the 2009 harvest is expected to total 3.26 billion bushels. Stocks on September 1, 2010, are projected at 250 million bushels.. The USDA projects the 2009-10 marketing year average farm price in a range of $8.30 to $10.30. The futures market currently reflects an average cash price for the upcoming year of just under $9.00, he said. SOURCE: University of Illinois Extension < Prev   Next >