-Soybean old crop sales minimal, but positive
-Corn sales solidly lower than expected
-Wheat old crop net cancellations, new crop sales lower than expected
-SBM sales at very bottom of expectations, SBM minor net cancellations
Old crop soybean sales, for the week ended 4/08/21, were minimal at 91k tonnes (3.3 million bushels), but fell within market expectations of net cancellations of 100k to positive sales of 200k and followed last week’s net cancellations of 6.2 million bushels, which reflected a revision from the initially-reported net cancellations of 3.4 mil bu. The net result over the last two weeks of sales, though, is net cancellations of 2.9 million bushels. This week’s activity included another 55k tonnes in net cancellations by China, while they still officially have roughly 785k tonnes of unshipped purchases on the books and potentially closer to 1.5 MMT taking into account sales to unknown. Total commitments of 2.233 billion bushels are still up a substantial 62% from last year, but with year ago sales over the next 12 weeks averaging more than 25 million bushels/week, total commitments could, conceptually, be up only 30-35% by the end of June if the recent sales pace continues. The USDA’s 2.280 billion bushel export projection reflects an estimated 36% increase from last year. We estimate soybean sales will need to average roughly 4 million bushels/week through the end of August to reach the USDA’s export projection. New crop sales of 266k tonnes (9.8 mil bu) were within expectations of 0-500k tonnes and included 264k tonnes to China. Total new crop sales of 216 mil bu compare to 35 million at this time last year.
U.S. corn sales last week of 328k tonnes (12.9 mil bu) were below market expectations of 500-900k tonnes, down from the previous week’s 29.8 mil bu, last year’s 35.7 mil bu and were a 6-week low. This week’s activity included net reductions in Chinese commitments of 24k tonnes (switched to Taiwan), as well as a net reduction in sales to unknown of roughly 80k tonnes. While this week’s sales were disappointing by market expectation standards, the fact remains that total sales on the books of 2.630 billion bushels are already effectively enough to allow the USDA’s 2.675 billion bushel export projection to be reached without any additional new sales being made through the end of August when taking into account the difference between Census Bureau and Export Sales data. Total commitments remain up 93% from last year vs USDA projecting exports up 50% on the year so there is plenty of room for minimal sales while still likely exceeding the USDA’s latest estimate. New crop sales of 53k tonnes (2.1 mil bu) compared to expectations of 0-300k, with 21/22 total commitments at 83 mil bu vs 96 million last year.
Old crop wheat sales were net cancellations of 57k tonnes (2.1 mil bu), while market expectations were for net positive sales of 50-200k, with weekly activity featuring net reductions in commitments of 27k tonnes by Japan, 28k Mexico and 36k South Korea. China showed net positive sales of 3k tonnes for the week. With the net cancellations, total commitments of 923 million bushels slipped below year ago levels (927 mil bu) for the first time since the 3rd week of the marketing year in mid-June, as we estimate wheat sales will need to average roughly 4.6 million bushels/week through the end of June in order to reach the USDA’s 985 million bushel export projection, while averaging only 3.4 million/week over the last three weeks. New crop sales of 274k tonnes (10.1 mil bu) were also below expectations of 300-500k tonnes, with 21/22 total commitments at 73 mil bu vs new crop sales last year of 68 million. USDA reported China cancelled 130k tonnes in new crop purchases last week.
U.S. soybean meal sales of 72k tonnes were at the very bottom of expectations of 75-25k tonnes, a marketing year low and down from the previous week’s 128k tonnes and last year’s 159k. It was also the first time since mid-December weekly SBM sales fell below the average “needed” pace at the time. Total commitments are now unchanged from last year vs USDA projecting a 1% increase on the year. Soybean oil sales were net cancellations of 1.5k tonnes vs expectations of 5-30k, putting total commitments down nearly 31% from last year vs USDA projecting exports down only 12% on the year. With SBO sales needing to average roughly 15k tonnes/week to reach the USDA’s projection, it certainly appears a further reduction in their estimate is likely.
