-Corn sales within expectations
-Soybean sales at extreme bottom end of expectations
-Wheat sales as expected
-SBM sales at top of expectations/SBO sales at bottom of expectations
U.S. corn sales, for the week ended 5/28/20, were 638k tonnes (25.1 million bushels), within market expectations of 400-900k tonnes and rebounded modestly from the previous week’s poor sales of 16.8 million bushels, but were still well below average sales over the previous 6-week period of 37.1 million bushels. Most importantly, though, corn sales continue to run well above the roughly 10 million bushel/week average pace we estimate is necessary through the end of August in order for the USDA’s 1.775 billion bushel export projection to be reached. Accordingly, we feel USDA is likely to raise their export projection in the June 11 WASDE report providing at least a partial offset to the expected reduction in their corn for ethanol usage estimate. Total commitments of 1.593 billion bushels are now down “only” 16% from last year’s 1.899 billion, continuing to close the gap, with the USDA’s current export estimate reflecting an estimated 14% decline in exports on the year.
U.S. soybean sales were 495k tonnes (18.2 million bushels), at the very bottom of market expectations of 500k-1.0 MMT, down from the previous week’s 23.7 million bushels and were the lowest in six weeks. While they were still better than the roughly 8.3 million bushels/week we estimate is needed in order to reach the USDA’s 1.675 billion bushel export projection, the limited sales to non-Chinese destinations is a concern moving forward. This week’s sales included net sales to China of 201k tonnes (267k in new sales/66k tonnes canceled/switched) leaving sales to all other destinations at only 294k tonnes (10.8 mil bu). Seasonally, those sales tend to decline towards the end of the marketing year, as well, so reaching the USDA’s export projection is still not yet assured. With soybean sales averaging more than 26 million bushels/week over the last five weeks, though, we expect USDA to hold the line on their export projection in this month’s WASDE report. Total commitments of 1.567 billion bushels are still down nearly 9% from last year’s 1.715 billion vs USDA estimating this year’s exports down 4% from last year.
New crop wheat sales of 457k tonnes (16.1 million bushels) were within market expectations of 100-600k tonnes and brought 2020/21 total commitments to 128 million bushels vs new crop sales at this time last year of 156 million bushels. This was the last full week of the 2019/20 marketing year with old crop unshipped (outstanding) sales still at 91 million bushels vs 60 million a year ago. With the majority of those old crop sales likely to be rolled forward into 2020/21, total commitments to start the year should be similar to year ago levels. Old crop sales were 180k tonnes (6.6 million bushels) vs expectations of 50-250k tonnes, putting 2019/20 total commitments at 990 million bushels vs 950 million a year ago. However, with the slow shipment pace to end the marketing year, we feel 2019/20 exports are likely to fall a bit short of the USDA’s 970 million bushel export projection.
U.S. soybean meal sales of 559k tonnes were at the top end of market expectations of 200-600k tonnes and were the highest in 19 weeks while also sharply outpacing year ago same-week sales of 111k tonnes. This week’s activity included 147k tonnes to the Philippines and 216k tonnes to unknown. Soybean meal total commitments of 10.5 MMT are down 4% from last year’s 11.0 MMT, but gaining, while sales over the five weeks prior to this week’s huge sales averaged 145k tonnes/week, easily beating the roughly 66k tonnes/week needed to reach the USDA’s export projection. With the solid sales pace of late, we feel USDA could tick their export projection higher in next week’s WASDE report. Soybean oil sales of 9.4k tonnes declined from the previous two weeks’ very strong 56.6k and 62.1k tonnes and still beat the mere 1k tonnes/week estimated “needed” pace to reach the USDA’s export projection, which clearly appears in need of a further upward revision. Soybean oil sales from this point forward last year averaged 10k tonnes/week. Total commitments are up 52% from last year vs USDA projecting a 31% increase in exports this year.
