USDA cuts US soybean production again but maintains stocks

The attention of the international and Brazilian soybean market was focused last week on the October report of the United States Department of Agriculture (USDA), which was released on the 12th. The numbers surprised again, with a significant cut in the production of the 2022/23 season, determining some price reactions in Brazil and Chicago. Gains were limited by the maintenance of US ending stocks for the 2022/23 season. We understand that the new USDA figure for US production in 2022/23 is too low.

The Department indicated that the US soybean crop must reach 4.313 bln bushels in 2022/23, equivalent to 117.38 mln tons. Yield was indicated at 49.8 bushels per acre. In September, the indications were 4.378 bln bushels (119.15 mln tons) and 50.5 bushels, respectively. The market was betting on 4.379 bln bushels for production, or 119.18 mln tons.

Ending stocks are projected at 200 mln bushels or 5.44 mln tons, repeating the previous month’s estimate. The market was betting on a carryover of 240 mln or 6.53 mln tons. USDA indicated crush at 2.235 bln bushels (60.82 mln tons) and exports at 2.045 bln (55.66 mln tons). Last month, the forecast was 2.225 bln (60.56 mln tons) and 2.085 bln (56.74 mln tons), respectively.

For the 2021/22 season, the Department indicated the production of 4.465 bln bushels, or 121.52 mln tons. Stocks were indicated at 274 mln bushels or 7.46 mln tons.

Regarding the global picture, USDA projected the 2022/23 world soybean crop of 390.99 mln tons. In September, the projection was 389.77 mln tons. Ending stocks are estimated at 100.52 mln tons, against 98.92 mln tons in September. The market was expecting ending stocks of 99.6 mln tons.

The USDA projection bets on the US crop with 117.38 mln tons, against 119.16 mln in September, as already mentioned. The Brazilian crop was indicated at 152 mln, and the Argentine crop at 51 mln tons. In September, the numbers were 149 and 51 mln, respectively.

China is expected to import 98 mln tons, up 1.0 mln from the September projection.

For the 2021/22 season, global production is estimated at 355.69 mln tons, with ending stocks of 92.38 mln. The market had projected carryover stocks of 90 mln tons.

The estimate for the Brazilian crop was raised from 126 to 127 mln and the forecast for Argentina remained at 44 mln. The number for Chinese imports stood at 90 mln tons, repeating September.

Tags: US, ending stocks, Production, crop, yield, Market, China, USDA, Brazil, soybean