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-NOPA September soybean crush slightly lower than expected
-NOPA September soybean oil stocks higher than expected – USDA 2020/21 SBO ending stocks estimate likely moving higher again

NOPA reported its members crushed 153.8 million bushels of soybeans in September, slightly less than average market expectations of 155.1 million bushels, down from 158.8 million in August and 4.8% (7.7 million bushels) less than last year’s 161.5 million. Over the previous three months, U.S. total soybean crush averaged 6.4% larger than NOPA-member crush, which would imply total crush around 163.6 million bushels vs 168.3 million in August and 171.1 million last year.

NOPA reported its members produced 1.814 billion pounds of soybean oil in September vs 1.873 billion in August and 1.873 billion pounds last year September, while the average soybean oil yield held steady from August at 11.79 pounds/bushel and remained significantly above last year’s September NOPA yield of 11.60. For the 2020/21 marketing year, NOPA members averaged a soybean oil yield of 11.75 pounds/bushel vs 11.55 pounds/bushel for the 2020/21 marketing year. Looking forward, crush data for October will help set early expectations for 2021/22 soybean oil yields as there is good relationship between October yields, as new crop soybeans make their way into crush facilities, and marketing year average yields, with an even better expectation of marketing year total yields once November data is available, as well. Getting back to production, over the previous three months, nationwide soybean oil production averaged 6.6% larger than NOPA member production, which would imply total production in the month around 1.933 billion pounds vs 1.990 billion in August and 1.968 billion last year and putting marketing year total production at around 25.017 billion pounds vs USDA’s current balance sheet assumption of 24.980 billion.

Despite crush being lower than expected, NOPA reported its members held end September soybean oil stocks of 1.684 billion pounds, above average market expectations of 1.663 billion, up slightly from 1.668 billion in August and substantially above last year’s 1.433 billion. Implied soybean oil “off-take” in September among NOPA members (August stocks + September production – September stocks) of 1.798 billion pounds was down from 1.822 billion in August and significantly below last year’s 1.959 billion pounds. The higher than expected NOPA stocks could also have implications for 2020/21 ending stocks as nationwide soybean oil stocks averaged roughly 30% larger than NOPA member stocks over the last six months. A similar difference for September stocks (2020/21 ending stocks) would put nationwide stocks at around 2.190 billion pounds, considerably above the USDA’s current old crop ending stocks estimate of 2.063 billion pounds. For reference, last year’s nationwide end September soybean oil stocks were 29.3% larger than NOPA-reported stocks. The contra-seasonal increase in soybean oil stocks over the last three months has been, quite frankly, startling in comparison to the typical decline in stocks during May-Sept as shown in the third chart below. Moreover, end September NOPA soybean oil stocks were easily the highest in nine years, putting a considerably less concerning view on the U.S. soybean oil situation than widely discussed in the marketing for much of the year. Based on today’s NOPA data, we anticipate another increase in the USDA’s 2020/21 ending stocks estimate in the November WASDE report, potentially by another 100+ million pounds as it appears old crop stocks are likely to end up being the highest since 2011/12.

NOPA reported its members produced 3.619 million tons of soybean meal in September vs 3.775 million in August and 3.788 million tons last year. Throughout the 2020/21 marketing year, nationwide monthly soybean meal production averaged 6.0% larger than NOPA production and would imply total production for the month around 3.836 million tons, putting estimated marketing year total production at 50.533 million tons vs USDA’s current balance sheet estimate of 50.604 million. NOPA reported its members exported 604k tons of soybean meal in September vs 857k in August and 991k tons last year.

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