Trade Estimates for USDA’s June Reports
- The trade looks for USDA to boost old- and new-crop corn stocks.
- 2019/20 corn stocks are expected at 2,150 million bushels with the 2020/21 average expectation at 3,360 million.
- The soybean balance sheet is not expected to change much for 2019/20 but expectations are for a boost from 405 million bushels in May to 426 now.
- New-crop wheat stocks are seen at 897 million bushels, down marginally.
- Argentina+Brazil soybean production is expected at 174 million tonnes, down from 175 million in May.
- Combined corn production is expected at 149 million tonnes, down from 151 million in USDA’s May report.
FBN’s Take On What It Means: The good news is that the South American production outlook is expected to be trimmed. Cuts for Brazil and Argentina could benefit the US. But, potential trims in crops in South America are not enough to fix the burdensome US corn stocks total that is expected for 2020/21.
China’s May Soybean Imports Higher
- At 9.4 million tonnes, May soybean imports were up from last year’s 7.4 million and above the April total at 6.7 million.
- Brazil is the key source with weather having delayed some shipping there.
- Expectations are for China’s June and July soybean imports to exceed nine million tonnes each as well.
- China has been buying some US beans, but most of its supplies are being sourced from Brazil right now.
FBN’s Take On What It Means: One key concern is whether China’s demand will be steady throughout the year. FBN leans towards that being possible with China then needing to come to the US for soybeans as Brazil’s domestic supplies tighten. FBN expects 2020/21 to be a solid year of soybean exports for the US.
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