As trade talks resume in China next week, there’s renewed hope for an uptick of soybean exports, but nothing of note has showed up in the latest USDA export report, out Thursday morning.
“Chinese buyers cancelled 5.4 million bushels last week, on top of another cancellation to unknown destinations announced yesterday by USDA,” according to Farm Futures senior grain market analyst Bryce Knorr. “With the 2018 marketing year winding down China still has 173 million bushels of unshipped sales on the books. Total commitments are already 5% above USDA’s forecast for the 2018 crop. But a lot of beans need shipping for the goal to be reached.”
Soybean exports found a net of 2.9 million bushels in old crop cancellations for the week ending July 18, plus 8.2 million bushels in new crop sales, for a meager total of 5.3 million bushels. That was less than half of the prior week’s tally of 12.0 million bushels and well below trade estimates of 11.0 million bushels.
Soybean export shipments fared better last week after reaching 23.4 million bushels. Despite China’s cancellation last week, the country leads all nations for U.S. soybean export commitments this marketing year, with 29% of the total. Other top destinations include the European Union (15%), Mexico (10%), Egypt (5%), Japan (5%) and Indonesia (5%).
Corn exports saw 4.8 million bushels in old crop sales plus another 15.2 million bushels in new crop sales for a total of 20.0 million bushels. That was moderately ahead of last week’s tally of 13.1 million bushels and slightly ahead of trade estimates of 18.7 million bushels. The weekly rate needed to match USDA forecasts moved slightly higher, to 23.6 million bushels.
“Corn appears less and less likely to hit USDA’s expectations for the 2018 marketing year, with only 4.8 million bushels of net old crop business reported last week,” Knorr says. “USDA has already cut its target for sales a couple of times as higher prices ration demand.”
Corn export shipments reached 22.8 million bushels last week. As the 2018/19 marketing year begins to wind down, Mexico leads all destinations for U.S. corn export commitments, with 31% of the total. Other top destinations include Japan (25%), Colombia (9%) and South Korea (7%).
Wheat exports did better than expected last week, with 24.2 million bushels in export sales. That was nearly double the prior week’s tally of 12.8 million bushels and well ahead of analyst estimates of 11.9 million bushels. The weekly rate needed to match USDA forecasts eased to 14.2 million bushels.
“Wheat enjoyed an unexpected bounce last week, topping the rate forecast by USDA by 10 million bushels,” Knorr says. “More than two dozen buyers showed up this week, though most of the totals purchased were small. Only Japan and Mexico purchased more than a single cargo.”
Mexico remains the No. 1 destination for U.S. wheat export commitments for 2019/20 so far, with 14% of the total. Other top destinations include the Philippines (12%), Japan (9%) and unknown destinations (9%).
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