USDA Soybean Numbers No Surprise
USDA on Friday raised its estimates of both 2002-2003 and 2003-2004 U.S. soybean ending stocks, but the changes were no surprise to the market and were likely already be factored into futures prices.
USDA raised projected 2003-2004 U.S. soybean supplies by 45 million bushels due to larger-old crop ending stocks and higher projected 2003 crop production.
USDA boosted projected 2003 soybean production by 30 million bushels to reflect the higher plantings reported in the June 1 acreage survey.
However, all but 10 million bushels of that supply increase were offset by stronger demand projections. Strong advance sales of new-crop U.S. soybeans, especially to China, led USDA to boost projected 2003-2004 exports by 30 million bushels. The projected crush was also upped by 5 million.
The end result was that projected 2003-2004 ending stocks were raised only 10 million bushels to 260 million bushels.
However, it’s important to note that USDA didn’t change its U.S. soybean yield estimate. If crop conditions do not deteriorate over the next month, USDA could up the yield estimate significantly, resulting in a much bigger 2003-2004 carryout.
USDA pegged 2002-2003 soybean ending stocks at 155 million bushels, up 15 million from last month's estimate, after its quarterly stock survey showed larger-than-expected June 1 stocks.
However, a 36-million bushel cut in projected seed/ residual usage was partly offset by a 20-million bushel increase in projected U.S. exports. USDA now pegs 2002-2003 soybean exports at 1.030 billion bushels.
Editors note: Richard Brock, The Corn and Soybean Digest's Marketing Editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.
To see more market perspectives, visit Brock's Web site at www.brockreport.com.