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June 15, 2020 | FBN Insights | Kevin McNew

NOPA Soybean Crush Record Expected for May

Increased use of soybeans is expected to continue to be the trend

NOPA Soybean Crush Record Expected for May   

  • The monthly NOPA report will be released at 11 a.m. CDT today.
  • The average pre-report estimate is for 173 million bushels of soybeans processed in May.
  • It would top the previous May crush record of 163.6 million bushels set in 2018.
  • If realized it would be a 0.8% increase from April's crush of 171.8 million bushels, and up 11.8% from 154.8 million in May last year.
  • May soyoil stocks are seen at 2.068 billion pounds, down from a nearly seven-year high of 2.111 billion at the end of April and 1.581 billion last year.

FBN’s Take On What It Means: Record soybean crush will be necessary to support the USDA raising its crush estimate in the April report. Fortunately, increased use of soybeans is expected to continue to be the trend as meal consumption remains elevated and the country comes out of the coronavirus slowdown. 

Cotton Lower After USDA Report

  • Cotton is weaker after USDA projected lower global consumption and higher ending stocks.
  • 2020/21 world ending stocks were forecast at 104.67 million bales, 5.2 million bales higher than last month.
  • USDA left US production unchanged at 19.50 million bales, while slightly cutting domestic consumption to 2.80 million bales.
  • The agency forecast world consumption at 114.41 million bales, down from 116.46 million bales projected in May, and showed global production only slightly lower at 118.74 million bales.

FBN’s Take On What It Means: Cotton stocks have been on the rise as the coronavirus pandemic has stalled demand. Futures prices were down over 32% at the lows made in early April. With countries gradually reopening, prices have staged a recovery, and are now 15% lower for the year. The market will need to see greater increases in demand, especially from the export market, for prices to recover further.

The risk of trading futures, hedging, and speculating can be substantial. FBN BR LLC (NFA ID: 0508695)

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