The biggest surprises included soybean ending stocks at 300 million bushels, which is 100 million bushels higher than trade estimates, and an unchanged yield average at 52 bushels per acre. (Photo: Iowa Soybean Association / Joclyn Bushman)
July WASDE squeezes soy stocks
July 20, 2023 | Brock Johnston
The U.S. Department of Agriculture (USDA) made several shifts to soybean supply and use projections in the latest World Agricultural Supply and Demand Estimates (WASDE) and Crop Production reports released July 12.
Ending stocks were lowered for the new-crop (2023-24) season to 300 million bushels. Pre-report expectations had soybean ending stocks 100 million bushels lower. The agency forecasts total U.S. production at 4.3 billion bushels, down 210 million from last month.
“New crop estimates were the biggest change in light of the acreage estimate that came from the June 30 report,” says Mac Marshall, vice president of market intelligence at the United Soybean Board. “The report accounted for an acreage estimate of 83.5 million planted acres, but left yield averages unchanged at 52 bushels per acre."
Marshall also noted that unchanged yield figures are typical for the July WASDE report.
“We were surprised, however, the yield figure wasn’t lowered with the drought pressure remaining in many parts of the country," Marshall says.
Timely rains will benefit the crop and bode well for overall soybean price position. Soybeans will still be trading in a 'weather market' throughout the balance of the season, according to Marshall.
The U.S. season-average soybean price forecasts for 2023/24 climbed to $14.20 per bushel, up 30 cents from last month. The soybean meal price increased $10 to $375 per short ton. The soybean oil price forecast of 60 cents per pound increased 2 cents.
USDA also lowered the export forecast by 125 million bushels to 1.85 billion on lower U.S. supplies and lower global imports. Soybean crush was also reduced slightly by 10 million bushels reflecting a lower soybean meal domestic disappearance forecast. As a result, total use was forecasted at 4.28 billion bushels.
Global soybean production
The USDA forecast includes an increase to 2022/23 (old-crop) stocks globally by 1.5 million tons to 102.9 million. Production estimates for Brazil and Argentina were left unchanged at 5.73 billion bushels and 918.6 million, respectively.
Global soybean trade for 2023/24 is down 3.1 million tons to 169.3 million in light of reduced U.S. exports and lower imports for China, Egypt, Bangladesh, Pakistan, Turkey and Thailand. China’s imports are lowered 1 million tons to 99 million due to higher carrying supplies from increased imports in the prior marketing year.
Global soybean ending stocks are reduced 2.4 million tons to 121 million, mainly on lower U.S. stocks.
View the full report here.