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November 20, 2007

 

ASA weekly: US soybean exports lag behind EU and China, but expected to hit 27.2 million tonnes in 2007-08

 

 

US soybean export this year lagged behind EU and China

 

However, cumulative figures showed export estimate of 27.2 million tonnes for 2007-08 is attainable.

 

The year-over-year decline in US soybean exports was not due to erosion in world import demand but to the increased competition from South American countries. US exports for September and October were 20 percent below on-year.

 

Meanwhile, Brazilian shipments were 6 percent below last year while Argentine exports tripled. Majority of Argentina's soybean exports go to China, a key market for US shipments.

 

US soybean exports to China is projected to pick up as Argentina's export pace diminishes. However, Argentine exports are projected to remain strong on November.

 

While soybean import demand from the EU-27 and the rest of the world is flat, those areas are importing considerably more soybean meal this year.

 

Soybean crush for October below trade expectations

 

The National Oilseed Processors Association's (NOPA) reported a decline of soybean crush which was only at 4.22 million tonnes, 27,200 tonnes below trade expectations.

 

However, records indicate that October's soybean oil yield was still the second highest for the month, only surpassed by the record high oil yield in 2005.

 

NOPA's soybean oil stocks for the end of October were 53,500 tonnes above the previous month and 19,100 tonnes above last year. Soybean oil stocks are back above 1.36 million tonnes, an indicator that soybean oil use in biodiesel production dropped further on October.

 

USDA November yield projection with no significant change

 

USDA reported no increase on its soybean yield forecast for the third consecutive month. Instead, it trimmed the expected yield by 0.0067 tonnes per hectare to 2.77 tonnes per hectare.

 

USDA's 2007 soybean yield forecast changed very little from the 2.79 tonnes per hectare yield forecast released last March. The yield estimate was maintained in USDA's May, June and July supply and demand reports.

USDA's 2007 yield forecasts, which extends as far back as a year ago when the 5-year baseline forecasts were put together, was recommendable according to industry observers.

 

The 0.0134 tonnes per hectare change in USDA's yield from August to November is the smallest since a 0.0067 tonnes per hectare change in 1997. In that year, USDA cut its yield by 0.0201 tonnes per hectare in September and increased it by 0.0134 tonnes per hectare in October.

 

The change from August to November averaged by 0.1277 tonnes per hectare over the last 20 years and 0.2353 tonnes per hectare over the last 5 years.

 

Unlike USDA's corn yield change in November that usually signals a similar change in January, there is no relationship between November and January soybean yield changes.

 

Yield changes from November to January typically are 0.0336 tonnes per hectare or less.

 

Senate farm bill in standstill

 

Due to a two-week thanksgiving recess, the farm bill debate is at standstill. Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell still have not agreed on the number and scope of any amendment offered as part of debate.

     

Democrats reportedly favored to limit each side to single or low-digit amendments. They also favored those amendments to be germane to the underlying farm bill. Republicans however called for an "open process."

 

Time constraint and senate rules are working against moving the farm bill before the end of 2007. Competing with the farm bill for senators' attention will be a number of appropriations measures and other must-have bills.

 

With this, the farm bill debate is said be continued into 2008. If Congress cannot agree on new legislation early in 2008, a short-term extension of current legislation is expected.

 

Soy holds steady amidst lower corn futures
 

Soybean futures managed to hold steady despite a stronger US dollar, lower corn futures and lower outside markets.

 

Soybean and product futures changed little overnight. Soy gained on corn this week, putting soybeans in a better position to regain U.S. acres next year.

 

However, farmers are months away from finalizing their 2008 planting decisions. January bean futures closed down US$0.28, finishing at US$396.37; March gained US$0.09, closing at US$402.06; and May was up US$0.28, ending at US$403.53. December meal increased US$1.21 closing at US$323.53; January was US$1.21 higher, finishing at US$325.62; and March meal closed up US$1.65 ending at US$330.25.84. December oil closed US$8.60 lower to finish at US$984.57; January was down US$9.92, closing at US$993.61; and March lost US$10.36, closing at US$1004.20.

 

U.S. & South America Soybean/Products Balance

 

United States 

Argentina

Brazil

Actual

Estimate

Proj.

Actual

Estimate

Proj.

Actual

Estimate

Proj.

2005/06

2006/07

2007/08

2005/06

2006/07

2007/08

2005/06

2006/07

2007/08

Soybeans

thousand tonnes

Carryin

6,960

12,229

15,589

174

334

2,814

1,638

2,252

2,578

Production

83,368

86,770

70,605

40,500

47,200

47,000

57,000

59,000

62,000

Imports

92

246

163

1,013

2,100

2,100

40

60

100

Crush

47,324

49,160

49,669

32,748

35,600

38,750

28,756

30,000

29,400

Exports

25,579

30,428

26,535

7,130

9,700

10,300

24,770

25,800

30,400

Other

5,288

4,068

4,447

1,475

1,520

1,620

2,900

2,934

2,950

Usage

78,191

83,656

80,651

41,353

46,820

50,670

56,426

58,734

62,750

Carryout

12,229

15,589

5,706

334

2,814

1,244

2,252

2,578

1,928

Soymeal

thousand tonnes

Carryin

156

285

319

1,686

1,996

1,696

640

794

754

Production

37,416

39,028

39,357

25,582

27,718

30,425

22,300

23,160

22,755

Domestic use

30,114

31,106

32,024

574

618

645

10,073

10,700

11,220

Net Exports

7,173

7,888

7,380

24,698

27,400

29,764

12,073

12,500

11,620

Usage

37,287

38,994

39,404

25,272

28,018

30,409

22,146

23,200

22,840

Carryout

285

319

272

1,996

1,696

1,712

794

754

669

Soybean oil

thousand tonnes

Carryin

771

1,366

1,321

385

484

519

248

300

286

Production

9,248

9,291

9,396

6,169

6,810

7,400

5,521

5,760

5,641

Domestic use

8,146

8,492

9,117

405

465

750

3,172

3,390

3,500

Net exports

507

844

685

5,665

6,310

6,670

2,297

2,384

2,192

Usage

8,653

9,336

9,802

6,070

6,775

7,420

5,469

5,774

5,692

Carryout

1,366

1,321

915

484

519

499

300

286

235

 

USDA Export Sales (tmt) - Week of 08 November 2007

Country

Commodity

New Sales

Accum. Exports

 

Country

Commodity

New Sales

Accum. Exports

Canada

Soybeans

20.40

86.80

 

Panama

Soymeal

1.50

14.80

China

Soybeans

916.50

2253.30

 

Philippines

Soymeal

53.50

153.60

Egypt

Soybeans

7.00

197.00

 

Saudi Arabia

Soymeal

8.40

10.60

Germany

Soybeans

54.50

254.20

 

Canada

Soymeal

3.50

33.30

Indonesia

Soybeans

10.80

297.10

 

Colombia

Soymeal

0.50

0.00

Israel

Soybeans

8.50

48.80

 

Egypt

Soymeal

5.00

0.00

Japan

Soybeans

186.10

600.70

 

Mexico

Soyoil

1.50

23.40

Mexico

Soybeans

20.70

778.00

 

Morocco

Soyoil

18.00

0.00

Netherlands

Soybeans

59.40

259.20

 

Trinidad

Soyoil

1.20

0.50

Taiwan

Soybeans

38.80

357.90

 

 

 

 

 

Canada

Soymeal

31.20

142.10

 

 

 

 

 

Guatemala

Soymeal

1.50

37.20

 

Export Sales Totals (tmt)

Indonesia

Soymeal

4.50

15.50

 

Commodity

Outstanding Sales

Accum. Exports

New Sales

Japan

Soymeal

10.10

35.00

 

Soybeans

8,440.10

6,007.80

1,296.40

Mexico

Soymeal

99.70

141.80

 

Soymeal

2,071.70

768.10

153.10

Morocco

Soymeal

15.00

30.80

 

Soyoil

124.40

50.60

29.70


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