-Dec NOPA soybean crush record high – higher than expected
-Dec NOPA soybean oil stocks much higher than expected – 9-year high
-Soybean oil yield continues at record high levels
NOPA reported soybean crush in December by its members was 186.4 million bushels, above average market expectations of 185.0 million, up solidly from 179.5 million in November and 1.8% above last year’s December crush of 183.2 million in easily setting not only a new record for the month of December but also an all-time monthly record, as well. Based on the recent-month relationship between NOPA and nationwide crush, December U.S. total soybean crush would be implied around 197.6 million bushels vs 190.5 million in November and 193.1 million bushels last year. Accordingly, we see Sept-Dec marketing year-to-date U.S. soybean crush at 750 million bushels vs 752 million last year, leaving Jan-Aug crush needing to total 1.441 billion bushels in order to reach the USDA’s 2.190 billion bushel annual estimate, which would be up 3.7% (52 million bushels) from last year and should be an easily achievable target given last year’s Feb-Aug crush ran at rather depressed levels given the concerns of a historically tight balance sheet at the time. We continue to see 2021/22 soybean crush a bit higher than USDA at 2.210 billion bushels.
NOPA reported its members produced 2.192 billion pounds of soybean oil in December vs 2.110 billion in November and 2.122 billion pounds last year, setting a new all-time monthly production record, on the combination of record high crush and record high soybean oil yields. NOPA members averaged 11.75 pounds/bushel for soybean oil yields in December, near unchanged from 11.76 in November and solidly above last year’s Dec yield of 11.59. Moreover, the 11.75 yield in December was easily a new record for the month in exceeding 2018’s previous record of 11.69. As seen in the third chart below, soybean oil yields tend to increase from December through May-June so this will be watched closely for additional confirmation of our current belief that the USDA’s current 11.83 pounds/bushel average yield assumption for 2021/22 still has a bit of upside potential as we’re at 11.86.
With the record soybean oil production in December, NOPA-member soybean oil stocks rose solidly to 2.031 billion pounds from 1.832 billion in November, coming in sharply higher than average market expectations of 1.892 billion pounds and even above the range of market ideas of 1.825-2.000 billion pounds. Additionally, Dec NOPA soybean oil stocks were a significant 19.5% (332 million pounds) higher than last year’s 1.699 billion, easily remaining at the highest level in nine years in being 15.5% (274 million pounds) higher than any December stocks since 2013. Based on the recent-month relationship between NOPA and nationwide soybean oil stocks, we anticipate U.S. total soybean oil stocks for the month being around 2.650 billion pounds vs 2.415 billion in November and 2.111 billion pounds last year. Implied monthly soybean oil “off-take” among NOPA members (last month’s stocks + this month’s production – this month’s stocks) of 1.992 billion pounds declined from 2.112 billion in November and was essentially unchanged from last year’s 1.981 billion pounds in December.
NOPA reported its members produced 4.357 million tons of soybean meal in December vs 4.202 million in November and 4.304 million tons last year, with the average soybean meal yield for the month ticking down to 46.74 pounds/bushel from 46.83 in November and continuing to run modestly below last year’s 46.99 in December.
