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Agriculture Americas

WASDE ups US soybean production outlook, yields

Healthier-than-expected production and carryout stock estimates deepened the soy market’s already strong sense of oversupply on Friday, putting fresh pressure on US soybean and soybean oil prices. The report tipped US soybean production at 3.94bn bu (107.1mn t), up slightly from August and down only 1% from the bumper 2014/2015 harvest. Yields were uprated to an average 47.1bu/acre, a gain of 0.2bu/acre from August on a record 83.5mn acre footprint. Carryout stocks meanwhile were forecast at 450mn bu, down 20mn bu from the previous month’s projection but still 25mn bu higher than market expectations. US corn production forecasts were marked down less than 1%, a smaller downgrade than the market had predicted. Corn end stocks were cut 7%, around 1% more than had been anticipated in pre-report surveys.

USDA kept its forecasts for Brazilian and Argentinian soy output unchanged MoM at 97mn t and 57mn t in the 2015/2016 marketing year respectively. For Brazil USDA’s figures indicate a 2.65% production increase from this year’s already record 94.5mn t harvest. But USDA’s 2014/2015 production estimate for Brazil significantly undershoots Conab’s own estimate of 96.2mn t of Brazilian soybean output for the current year, according to fresh figures also released on Friday. S&P’s cut in Brazil’s credit rating to junk on Wednesday meanwhile and a renewed slide in the Real’s buying power relative to the dollar will do little to help the cause of US exporters already struggling to keep up new marketing year sales. Outstanding soybean sales plus accumulated exports totalled just 6.1mn t for the 2015/2016 marketing year at the start of September, less than half the 13.3mn t booked at the same period last year. Total US overseas sales commitments were languishing at 16.1mn t compared to 24mn t a year ago, according to US export data.

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