February 28, 2005

US soy exports seen to rise 5 percent in 2005-06

The US is expected to export 5% more soybeans in 2005-06, or 50 million bushels more than in 2004-05.

The USDA set the new 2005-06 export forecast at 1.06 billion bushels, up from 1.01 billion bushels in 2004-05.

Soybean prices are expected to drop with higher ending stocks in 2005-06 and less competition is forecast from South America, USDA economists said in the Outlook report.

"With lower prices and negligible appreciation of the dollar, the outlook for US exports throughout the soybean complex looks better than in recent years," the USDA said. "This increase would interrupt a long-term decline in the US market share of world soybean exports."

The USDA also raised its export forecasts in 2005-06 for US soymeal and soyoil. The prediction for soymeal exports was set at 6.4 million short tons for 2005-06, up from 5.7 million short tons in 2004-05. For soyoil, exports are forecast to reach 1.5 billion pounds, up from 1.3 billion pounds.

"South American (soybean) producers are expected to view the falling price trend and rising production costs as a signal to suspend their decade-long area expansion," the USDA said. "Despite slowing production growth, record-large South American soybean stocks this year will boost 2005-06 supplies, but at a reduced rate. ... With world output growth slowing, US supplies are expected to be more competitive in world markets."

Source: USDA