-Soybeans/corn see huge sales weeks
-Wheat sales solid
-Old crop SBM/SBO sales minimal, strong new crop SBM sales
U.S. soybean sales, in the first week of the 2020/21 marketing year, were huge at 3.162 MMT (116.2 million bushels), sharply above market expectations of 1.1-1.9 MMT, with 1.593 MMT in reported sales to China, as well as at least 1.0 MMT to unknown. As 2020/21 officially gets underway, total commitments already sit at 1.098 billion bushels vs 347 million bushels at the start of the 2019/20 marketing year with 15.9 MMT on the books to China vs a mere 1.1 MMT at this time last year. With the large amount of sales already on the books, soybean sales will need to average roughly 21 million bushels/week over the course of the 2020/21 marketing year in order to exports to reach the USDA’s current 2.125 billion bushels, considerably below last year’s 27.4 million bushels/week, which featured China playing catch-up after having very little on the books to start the year.
U.S. corn sales, for the week ended 9/03/20, were also strong at 1.823 MMT (71.8 mil bu), at the very top end of market expectations of 1.0-1.9 MMT and featured 1.26 MMT in sales to China, putting their 2020/21 total purchases at 8.8 MMT. Total commitments to all destinations, to start the 2020/21 marketing year, of 742 million bushels compares to 283 million bushels a year ago. Based on the USDA’s 2.225 billion bushel export projection, corn sales will need to average roughly 28.3 million bushels over the course of the year vs 28.9 million/week in 2019/20.
U.S. wheat sales were respectable at 484k tonnes (17.8 million bushels), in line with market expectations of 250-600k tonnes, but below average sales over the previous eight weeks of 22.5 million bushels/week. Total commitments, though, of 476k tonnes are up 8% from last year’s 441 million, ahead of the USDA’s projected 1% increase in exports in 2020/21 of 975 million bushels. In order to reach the USDA’s projection, we estimate wheat sales will need to average roughly 13.6 million bushels/week through the end of next May vs 14.4 million/week from this point forward last year. This week’s activity reflect a minor net decline in sales to China of less than 1k tonnes, as they currently have 920k tonnes of U.S. wheat purchased vs none last year.
New crop soybean meal sales were strong at 333k tonnes, in the range of expectations of 200-400k tonnes, while old crop sales were minimal at 27k tonnes (25-100k expected). Old crop sales on the books are already enough, for the most part, to allow the USDA’s export projection to be met with nearly 4 weeks remaining in 2019/20, while 2020/21 sales of 1.871 MMT compare to new crop sales at this time last year of 1.696 MMT. Old crop soybean oil sales were 4.1k tonnes (0-10k expected), as sales have slowed dramatically of late, averaging only 1.5k tonnes/week over the last five weeks. The USDA’s old crop export projection is still reachable, but may be in risk of being slightly too high. New crop “sales” were net cancellations of 3k tonnes, with 2020/21 total commitments of 102k tonnes comparing to new crop sales at this time last year of 37k tonnes.
