USDA Weekly #Grain Export Sales

-Big sales week for soybeans/corn
-Soybean sales sharply above expectations
-Corn sales strong – larger than expected
-Wheat sales weak – lowest in 10 weeks
-Solid new crop SBM sales

U.S. soybean sales, for the week ended 9/12/19, were strong at 1.728 MMT (63.5 million bushels), well above reported market expectations of 700k-1.1 MMT, with 593k tonnes reported in sales to China and 548k tonnes to unknown. Another solid week of sales is likely to be seen next week as the return of modest Chinese buying continues to be accounted for. It is still generally believed China bought around 1.0-1.5 MMT recently. However, they still only officially have 1.66 MMT of purchases on the books, similar to last year’s minimal early purchases, as well, of 1.45 MMT, while total purchases similar to last year’s 14.2 MMT may very well be necessary if 2019/20 exports are going to reach the USDA’s 1.775 billion bushel export projection. Total commitments of 411 million bushels are sharply below last year’s 654 million bushels at this time, resulting in weekly sales needing to average roughly 27.6 million bushels over the course of the marketing year vs last year’s 22.8 million bushels/week average.

U.S. corn sales were strong last week, as well, at 1.465 MMT (57.7 million bushels), beating market expectations of 900k-1.3 MMT, but were mostly in line with last year’s same-week sales of 54.4 million bushels. Nearly all of this week’s sales, though, were to Mexico at 1.164 MMT. The next largest sales for the week were a mere 99k tonnes to Costa Rica. While the strong sales to Mexico were nice to see, the extremely limited sales to other destinations certainly is disappointing. The Mexican purchases essentially brought them back in line with last year’s purchases at this time, now with 4.8 MMT on the books vs 5.0 MMT last year. Despite the strong weekly sales, though, total commitments of 341 million bushels remain sharply below last year’s sales at this point of 652 million bushels and are the lowest in 17 years for mid-September. We estimate corn sales will need to average roughly 33.2 million bushels/week over the course of the 2019/20 marketing year in order to reach the USDA’s 2.050 billion bushel export projection vs last year’s average sales from this point forward of 26.3 million/week.

U.S. wheat sales were disappointing at a 10-week low of 287k tonnes (10.5 mil bu), coming in below market expectations of 300-600k tonnes, falling sharply from the previous week’s 22.4 million bushels and were below last year’s same-week sales of 17.2 million bushels. Total commitments of 452 million bushels are still up more than 20% from last year’s 375 million, but the year-over-year gain has been consistently declining after having been up 25% in mid-July. Given the respectable overall sales to start the year, though, wheat sales only need to average roughly 13.3 million bushels/week in order to reach the USDA’s 975 million bushel export projection vs last year’s 15.5 million/week average from this point forward.

Old crop soybean meal sales of 94k tonnes were within market expectations of 0-200k, while new crop sales were solid at 342k tonnes, beating expectations of 50-250k, thanks in large part to 204k tonnes bought by Mexico last week. New crop soybean meal total commitments are similar to those at this time last year at 2.038 MMT. Old crop soybean oil sales of 19k tonnes were within market expectations of 0-25k tonnes, while new crop sales were minimal at 1.7k tonnes.

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