-New crop soybean/corn sales remain strong – within expectations this week
-Wheat sales marginally top expectations
-SBM/SBO sales within expectations
New crop soybean sales were strong again, as expected, at 1.874 MMT (68.9 million bushels) vs market expectations of 1.2-2.2 MMT with 592k tonnes in sales officially reported to China, along with 822k tonnes reflected as unknown. This brings China’s reported purchases for 2020/21 to 12.5 MMT vs new crop purchases at this time last year of a mere 260k tonnes, while there are also 6.7 MMT in sales on the books to unknown vs 5.6 MMT last year. Total commitments for 2020/21 are now at 824 million bushels vs new crop sales at this time last year of 206 million and are the highest on record with one full week remaining in the old crop marketing year, surpassing the 765 mil bu on the books at this time ahead of the 2014/15 marketing year. In context, though, current new crop sales on the books represent 39% of the USDA’s estimated annual exports next year of 2.125 bil bu, while new crop sales at this time for the 12/13-14/15 marketing years reflected 42-49% of eventual annual exports. Old crop sales were minimal, as expected, at 51k tonnes (1.9 mil bu), bringing 2019/20 total commitments to 1.747 bil bu vs 1.790 bil at this time last year. With the strong pick-up in late-season loadings to China, it appears the USDA’s 1.650 bil bu export projection will likely be exceeded by 20-40 million bushels.
New crop corn sales of 1.181 MMT (46.5 mil bu) were strong, but within market expectations of 700k-1.3 MMT with 666k tonnes reported to China for the week. This brought 2020/21 total commitments to 527 million bushels vs new crop sales at this time last year of 218 mil bu and are the 2nd highest on record with one full week remaining in the old crop marketing year, falling only below 575 million bushels ahead of the 1995/96 marketing year. New crop sales on the books reflect 23.7% of the USDA’s current export ideas vs the most-recent 5-year average of 15.3% and is well above long-term averages, but there have been multiple years in which new crop sales at this time account for 20-27% of eventual annual exports. China now has 6.4 MMT of U.S. corn on the books for 2020/21, already well above record annual U.S. corn exports to China of 5.15 MMT. Old crop sales were respectable for this late in the year at 270k tonnes (10.6 mil bu) vs expectations for 0-200k tonnes. It appears 2019/20 exports are likely to slightly exceed the USDA’s 1.795 billion bushel projection. 2019/20 total commitments of 1.752 bil bu compare to 1.972 bil at this time last year.
U.S. wheat sales last week of 764k tonnes (28.1 mil bu) slightly exceeded market expectations of 400-700k tonnes, rose solidly from the previous week’s 19.1 mil bu and were a marketing year high now 12 weeks into 2020/21. Total commitments of 436 mil bu are up 7.2% from last year’s 407 million and continue to run modestly stronger than the USDA’s projection of exports to be up 1.0% year-over-year. We estimate wheat sales will need to average roughly 13.9 million bushels/week through the end of May vs last year’s 14.6 million/week average from this point forward last year. At this time, we are leaning a bit higher on wheat exports vs the USDA’s current 975 million bushel projection.
Old crop soybean meal sales of 53k tonnes and new crop sales of 98k tonnes were both within, but at the lower end of market expectations of 50-200k tonnes and 75-300k tonnes, respectively. Nonetheless, old crop sales only need to average roughly 33k tonnes/week through the end of September to reach the USDA’s export projection, while 2020/21 total commitments of 1.309 MMT are only modestly below last year’s 1.456 MMT at this time. Old crop soybean oil sales have slowed dramatically, of late, though, with last week’s sales of 1.3k tonnes following the previous two weeks of minor net cancellations. One or two weeks of decent old crop sales may still be needed in order for the USDA’s export projection to be reached. New crop sales were respectable at 21k tonnes vs expectations of 0-15k. New crop SBO sales are typically quite limited with 2020/21 commitments now at 102k tonnes vs a mere 25k tonnes on the books at this time last year.
