Porto Alegre, August 18, 2020 – The August supply and demand report from the U.S. Department of Agriculture, released on the 12th, surprised the market by bringing major positive adjustments to U.S. crop and stock estimates for the 2020/21 season. Although the market was already waiting for positive adjustments, they exceeded most projections.
USDA indicated that the U.S. soybean crop is expected to stand at 4.425 billion bushels in 2020/21, equivalent to 120.43 mln tons, above the previous estimate of 4.135 billion or 112.54 mln. The market was betting on the production of 4.278 billion or 116.43 mln tons. If confirmed, it will be the second-largest soybean crop in the U.S. history, just behind the 2018/19 crop, whose production hit 120.5 mln tons.
Final stocks are estimated at 610 mln bushels or 16.6 mln tons. The market was betting on carryover stocks of 527 mln or 14.34 mln tons. In the previous report, stocks were projected at 425 mln bushels – 11.57 mln tons.
USDA indicated the crush at 2.180 billion bushels (59.33 mln tons) and exports at 2.125 billion bushels (57.83 mln tons). In July, the projections were 2.160 billion (58.79 mln tons) and 2.05 billion (55.79 mln tons), respectively.
The 2019/20 production is estimated at 3.552 billion bushels (96.67 mln tons). Final stocks in 2019/20 are projected at 615 mln bushels (16.74 mln tons), as expected. In the previous report, the number was 620 mln (16.87 mln tons). The crush is estimated at 2.16 billion (58.79 mln tons), and exports at 1.65 billion bushels (44.91 mln tons).
Concerning the world scenario, USDA projected the global soybean crop in 2020/21 at 370.4 mln tons. In July, the number was 362.52 mln tons.
Final stocks are estimated at 95.36 mln tons. The market expected final stocks of 98.2 mln tons. In July, the forecast was 95.08 mln tons.
USDA projects the U.S. crop with 120.4 mln tons, as already mentioned. For Brazil, the forecast is for a production of 131 mln tons. Argentina must produce 53.5 mln tons. The estimate for Chinese imports in 2020/21 is 99 mln tons, against 96 mln in the previous year.
For 2019/20, USDA indicated a crop of 337.28 mln tons. Final stocks are projected at 95.85 mln tons, while the market was betting on 98.6 mln. The Brazilian crop had its estimate maintained at 126 mln tons. The market had predicted 125.4 mln.
The Argentine crop was reduced from 50 to 49.7 mln tons, while the market had estimated 49.9 mln. Chinese imports were increased from 96 to 98 mln tons.
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