-Old crop corn sales larger than expected
-Old crop soybean sales minimal
-Wheat sales as expected
-SBM sales remain respectable/SBO sales minimal
Old crop U.S. corn sales, for the week ended 5/27/21, of 531k tonnes (20.9 million bushels) were above market expectations of -200k to +400k tonnes and followed the previous week’s solid sales of 21.9 million bushels, as well. New net old crop purchases by China of 95k tonnes were reported this week (also 64k switched from unknown), with the largest buyer being South Korea with 143k tonnes. This week’s sales push total commitments to 2.721 billion bushels, which could already be enough to allow the USDA’s 2.775 billion bushel export projection to be met when taking into consideration official Census Bureau trade data appears likely to be 100-125 million bushels larger than exports indicated by Export Sales for the entirety of the marketing year. Accordingly, we see little option but for USDA to further raise their export projection in next week’s WASDE report. China continues to aggressively ship old crop purchases, with outstanding sales now down to 8.4 MMT, reducing some of the concern of potentially carrying over a large portion to new crop. New crop sales of 439k tonnes (17.3 mil bu) were within market expectations of 300-900k tonnes, with no new Chinese buying reported, bringing 2021/22 sales to 593 million bushels 134 million last year and easily record high.
U.S. old crop soybean sales were minimal at 18k tonnes (0.7 mil bu) vs market expectations of -100k to +200k tonnes, putting total commitments at 2.261 vs 1.567 billion last year, which likely still requires sales to average 3-4 million bushels/week through the end of August in order to reach the USDA’s 2.280 billion bushel export projection. Over the last four weeks, sales have averaged only 2.3 million bushels/week so a continuation of the recent sales pace over the final three months of the year could put the USDA’s export estimate at risk to being a bit too high. Unshipped Chinese old crop purchases are down to 697k tonnes. We look for USDA to hold their export estimate steady in this month’s update. New crop sales were 180k tonnes (6.6 mil bu), in line with expectations of 0-400k tonnes, with sales to China of only 10k tonnes (132k unknown), bringing 21/22 total sales to 274 mil bu vs 108 million at this time last year.
New crop wheat sales were 398k tonnes (14.6 mil bu), in line with expectations of 200-500k tonnes and bringing 2021/22 total sales to 160 million bushels vs 128 million last year heading into the new marketing year with next week’s data. There was no Chinese activity of note for the week. The final full week of old crop sales activity included net cancellations of 33k tonnes (1.2 mil bu) vs expectations of -25k to +100k tonnes, with the final 2020/21 exports likely to prove within 10 million bushels of the USDA’s 965 million bushel export projection.
Soybean meal sales remain quite respectable with 218k tonnes sold for the week, in line with expectations of 100-300k tonnes, while averaging 176k tonnes/week over the last five weeks, solidly above the roughly 102k/week average we estimate is needed to reach the USDA’s export projection. While USDA has time, we would not be surprised if they bump their export projection a bit higher in next week’s update. Soybean oil sales, on the other hand, remain abysmal with only 1k tonnes sold for the week vs expectations of -10k to +25k tonnes, with total sales over the last four weeks combined essentially being zero given the net cancellations three weeks ago. Based on the USDA’s current export projection, we estimate SBO sales would need to average roughly 16k tonnes/week through the end of September, while they have totaled only 12.8k tonnes over the last 8 weeks combined. Exports are looking as though they could easily be 150-200 million pounds less than the USDA’s current estimate.
