-Corn sales at top end of expectations
-Soybean sales within expectations
-Wheat sales modest but within expectations
-SBM sales at bottom end of expectations but more than “needed”, SBO sales at top of expectations
U.S. corn sales, for the week ended 1/30/20, were solid again at 1.248 MMT (49.1 million bushels), at the top end of market expectations of 600k-1.3 MMT, ticking higher from the previous week’s 48.6 mil bu and, for the 4th consecutive week, beating the average weekly “needed” sales pace of roughly 27.4 million bushels in order to reach the USDA’s 1.775 billion bushel export projection. This week’s activity included 410k tonnes to Mexico, 194k to Japan and 140k to Colombia and roughly 233k tonnes reported as unknown. Total commitments of 897 million bushels are now down an estimated 37% from last year (direct comparison to last year not available due to government shutdown at the time) and continue to make up ground having been down more than 50% in early October. Year ago sales from this point forward were quite weak at just 17.9 million bushels/week on average amid the strong ramp up in Brazilian exports, while the current “needed” pace fits within the context of past years coming off strong Brazilian exports. For now, we look for USDA to hold the line on their export projection.
U.S. soybean sales last week were 704k tonnes (25.9 mil bu), within market expectations of 400-800k tonnes and up from the previous week’s 14.7 mil bu. However, this week’s sales got a visual boost as last week’s sales were revised lower from originally being reported at 17.3 mil bu. Without the revision, this week’s sales would have been 23.3 mil bu (~634k tonnes). China was shown as a new buyer of a mere 32k tonnes for the week, with the largest buyers being Egypt with 264k tonnes and Germany with 69k. Sales to unknown this week were roughly 135k tonnes. Total commitments of 1.187 billion bushes are down an estimated 7% from last year and slipping. Over the 6-week government shutdown period last year in which data was not reported, soybean sales averaged 39.2 million bushels/week, while they have averaged just 23.3 million bushels over the last four weeks. We estimate soybean sales will need to average roughly 19.3 million bushels/week in order to reach the USDA’s 1.775 billion bushel export projection, which would be a record for the Feb-Aug period and up from last year’s 17.3 million/week average from this point forward. We see USDA holding the line on their export projection this month.
U.S. wheat sales last week were modest at 339k tonnes (12.4 mil bu), within market expectations of 200-700k tonnes, above the roughly 9.0 million/week they need to average in order to reach the USDA’s 975 million bushel export projection, but were the lowest in four weeks. Total commitments of 781 million bushels are up an estimated 5% from last year, while the USDA’s export estimate reflects an expected 4.2% increase in exports on the year. While the overall pace of sales/shipments of late could allow USDA to bump their export estimate up a bit in next week’s WASDE report, would we not be surprised if they left it unchanged either. The largest sales this week went to the Philippines with 95k tonnes.
Soybean meal sales were solid in the overall scheme of things at 213k tonnes, easily beating the roughly 126k tonnes/week “needed” pace to reach the USDA’s export projection, but pulled back from the blistering pace of the previous three weeks’ sales of 375-642k tonnes. Total commitments of 7.281 MMT are down an estimated 8% from last year vs USDA projecting a 2.6% year-over-year decline in exports so there is still work to be done in that regard. Overall, though, SBM sales simply will need to keep pace with last year in order to reach the USDA’s export projection. Any improvement/increase in Argentine crushing, though, could throw a wrench into that prospect. Soybean oil sales were strong at 52.9k tonnes, in the upper end of market expectations of 12-60k tonnes and were the 2nd highest of 2019/20 so far. Soybean oil sales over the last four weeks have been impressive, averaging 43.5k tonnes/week vs the estimate average “needed” pace of just 5-6k tonnes/week. Total commitments of 602k tonnes (1.328 bil pounds) are up an estimated 29% from last year vs USDA estimating annual exports down 12.4% on the year. It clearly appears an upward revision in the USDA’s projection is forthcoming in next Tuesday’s WASDE report.
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