-Soybean sales net cancellations – sharply below expectations
-Corn sales sharply below expectations – marketing year low
-New crop wheat sales decent
-SBM/SBO sales as expected
U.S. soybean sales, for the week ended 5/02/19, were net cancellations of 149k tonnes (5.5 million bushels) vs market expectations of sales for the week of 300-650k tonnes. Net sales reductions of 264k tonnes were reported for unknown destinations, but also of 54k tonnes to Malaysia, 51k Indonesia, 34k Thailand, 13k Philippines and 3k Egypt. The largest net positive soybean sales of the week were to Mexico of a mere 24k tonnes. This week’s activity lowered total commitments to 1.653 billion bushels, which is down 18.4% from last year’s 2.026 billion, leaving sales needing to average roughly 9 million bushels/week through the end of August to reach the USDA’s export projection, above last year’s 8.1 million/week from this point forward and would be historically high – a rather unlikely scenario in the current global trade structure. We look for USDA to lower their export projection in tomorrow’s WASDE report.
U.S. corn sales last week were a marketing year low of 288k tonnes (11.3 million bushels), falling from the previous week’s 23.1 million bushels, well below last year’s same-week sales of 27.4 million bushels, half of the roughly 22.6 million bushels/week in which corn sales will likely need to average through the end of August in order to reach the USDA’s 2.300 billion bushel export projection and were well below market expectations of 500-800k tonnes. Total commitments of 1.825 billion bushels are now down 10.2% from last year’s 2.033 billion (USDA projecting a 5.7% decline for the year). We look for USDA to modestly cut their export projection in tomorrow’s WASDE report. The largest sales of the week were just 46k tonnes by Colombia.
Old crop wheat sales were 91k tonnes (3.3 million bushels), at the bottom of market expectations of 75-250k tonnes, but minimal sales over the final weeks of the marketing year are to be expected. We feel USDA is likely to leave their 2018/19 wheat export projection unchanged tomorrow as sales on the books are large enough to allow their current estimate to be reached – it’s just a matter of actually getting it shipped. New crop sales were respectable at 412k tonnes (15.1 million bushels), which were above market expectations of 100-350k tonnes and brought 2019/20 total commitments to 94 million bushels vs 71 million at this time last year, but are still below new crop sales at this point over the previous five years, which ranged from 100-151 million bushels.
Soybean meal sales of 151k tonnes were within market expectations of 75-250k tonnes and rebounded from the previous week’s poor sales of 79k tonnes and were well above last year’s same-week sales of 91k tonnes. Total commitments are up 1.7% from last year (USDA projecting a 7.3% decline in annual exports), while sales over the last six weeks have averaged 200k tonnes/week vs the roughly 85k/week they need to average to reach the USDA’s export target. Soybean oil sales of 16.4k tonnes were also within market expectations of 5-26k tonnes, up from the previous week’s poor 7.3k tonnes, but well below last year’s same-week sales of 45.4k. Total commitments are now down 18.7% from last year, and falling fast, vs the USDA estimating SBO exports to be down just 8.1% from last year.
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