-Soybean sales stronger than expected
-Corn sales weaker than expected
-Wheat sales better than expected
-SBM/SBO sales solid
U.S. soybean sales, for the week ended 3/28/19, were stronger than expected at 1.972 MMT (72.4 million bushels) as all of the previously-announced sales to China showed up in this week’s data. Wire service-reported trade ideas on today’s soybean sales were 800k-1.5 MMT. Nearly all of this week’s sales, though, went to China at 1.700 MMT, with total sales to all other destinations being a mere 272k tonnes. This week’s notable sales to China certainly will help regarding the USDA’s export projection, but sales will still need to average roughly 12.8 million bushels/week through the end of August, larger than last year’s average weekly sales from this point forward of 12.3 mil bu/week. Whether the USDA’s 1.875 billion bushel export projection is met or not is likely to all come down to Chinese purchases from this point forward. If they buy additional old crop quantities, the USDA’s estimate is reachable, but if future Chinese purchases end up being for 2019/20 delivery, which is seen as quite possible, the USDA’s projection is likely still too high as sales to non-Chinese destinations of late have been very limited and likely to remain so through the end of the marketing year. Total commitments of 1.604 billion bushels are still down 15% from last year vs the USDA estimating exports to be down 12% on the year. China now officially has 12.6 MMT of soybeans on the books vs 28.7 MMT at this time last year.
U.S. corn sales last week were disappointing at just 537k tonnes (21.2 million bushels), coming in below market expectations of 700k-1.1 MMT, falling from the previous week’s 35.5 million bushels and were below last year’s same-week sales of 35.4 million bushels, as well as the average “needed” sales pace of 26.5 million bushels/week in order to reach the USDA’s 2.375 billion bushel export projection. Nearly all of this week’s sales were routine with 276k tonnes to Japan and 258k tonnes to Mexico, accounting for a combined 534k of the 537k tonnes total, with all other activity essentially being a net wash with switches out of “unknown.” Not a good sign for U.S. corn sales through the end of 2018/19, particularly with sales needing to run nearly 12% above year ago levels in order for the USDA’s export projection to be reachable. Total commitments of 1.701 billion bushels are down 9% from last year and declining, while the USDA is currently estimating total exports to be down less than 3% on the year.
U.S. wheat sales last week were quite respectable at 705k tonnes (25.9 million bushels), coming in above market expectations of 300-600k tonnes, rising from 17.5 million bushels the previous week and may have been the largest since the first week of December (assuming averaged sales over the 6-week government shutdown period). Given the continued solid late-season sales pace, the USDA’s 965 million bushel export projection clearly appears reachable at this time as sales only need to average roughly 4.6 million bushels/week through the end of May vs last year’s 3.3 million/week from this point forward, but the actual shipment pace continues to solidly lag the USDA’s projection so it will likely simply come down to whether old crop sales are actually loaded during 2018/19 or they are shifted forward to 2019/20. Total commitments of 894 million bushels are up 6% from last year’s 842 million at this time, while the USDA is estimating a 7% increase in wheat exports on the year. The largest sales this week included the previously-announced 200k tonnes to Iraq and 120k tonnes to Egypt, along with 115k tonnes to Indonesia and 70k to the Philippines.
U.S. soybean meal sales of 190.3k tonnes rebounded from the previous two weeks’ sales each below 100k tonnes and were in line with market expectations of 100-350k tonnes, while easily beating the roughly 107k tonnes/week sales need to average to reach the USDA’s export projection. SBM commitments, though, continue to slip notably relative to last year with the 9.321 MMT on the books now up only 2% from last year’s 9.109 MMT after being up more than 10% in late December. This is expected to continue, though, as the USDA is projection SBM exports down 7% from last year. Soybean oil sales were quite solid at 36.8k tonnes, beating expectations of 0-25k tonnes and were the largest in 19 weeks and the 2nd largest of the 2018/19 marketing year so far (assuming averaged sales during the 6-week government shutdown). SBO activity included 10k tonnes to unknown, 9k to South Korea and 7.5k to Colombia. SBO total commitments of 585k tonnes are down nearly 16% from last year’s 693k, while the USDA is estimating SBO exports to be down 8% on the year.
