March 4, 2002
CONSUMPTION TO SLOW, BUT HOW MUCH?
For the current
marketing year, the USDA projects the U.S. soybean crush at 1.68
billion bushels, about 2.4 percent larger than the crush during
the 2000-01 marketing year. Crush during the first 5 months of
the marketing year totaled 735.6 million bushels, 3.6 percent
more than crushed during the same period last year. The larger
crush is being driven by soybean meal consumption. Consumption,
domestic plus exports, during the first 4 months of the 2001-02
marketing year was 4.6 percent larger than during the same period
last year. Commercial exports of U.S. soybean meal through February
21, 2002 were 9.2 percent larger than cumulative exports of a
year agio. Canada and Mexico account for much of the increase.
Stocks of soybean meal (at mills) at the end of January totaled
only 290 thousand tons, 44 thousand less than on the same date
of U.S. soybean oil during the first four months of the 2002-02
marketing year was 3.2 percent larger than during the same period
last year. However, the inventory of soybean oil at the end of
January 2002 totaled a record 3.045 billion pounds. Stocks were
28 percent larger than on the same date last year. The inventory
situation would have been even more burdensome if the yield of
soybean oil to date had equaled the yield of a year ago. For the
period September 2001 through January 2002, the average yield
of oil per bushel of soybeans crushed was 11.07 pounds. A year
agio, the yield was 11.2 pounds. The difference represents 95
million pounds of oil. In January 2002, the average oil yield
was only 10.9 pounds, 0.3 pounds less than in January 2001.
of the U.S. soybean crush typically begins to decline in February
as South American competition increases. If the USDA's projection
for the year is correct, the U.S. crush from February through
August 2002 will total 944.5 million bushels, only 0.7 percent
more than during the same period last year.
For the current
marketing year, the USDA projects U.S. soybean exports at 1.02
billion bushels, 2.2 percent more than exported during the 2000-01
marketing year. Based on the USDA's weekly export inspections
report, U.S. soybean exports during the first half of the 2001-02
marketing year totaled 777 million bushels, 16 percent more than
exported during the same period last year. The increase on exports
was led by larger shipments to the major buyers European
Union (19 percent), China (14 percent), and Mexico (11 percent).
To reach the USDA projection, exports during the last half of
the marketing year will need to total only 243 million bushels,
26 percent less than exported during the same period last year.
As of February 21, unshipped sales of U.S. soybeans totaled 157
million bushels, 26 percent less than outstanding sales of a year
agio. Unshipped sales to China totaled only 10 million bushels,
compared to 68 million of a year ago.
apparently accelerated the purchase of soybeans before the new
regulations relative to genetically modified crops goes into effect
later this month. Rumors about the implementation of those rules
continue to be circulated, but there is no strong evidence that
implementation will be delayed or modified. That development will
be extremely important over the remainder of the marketing year.
from South America indicate that the areas of dry weather this
year have likely had a negative impact on soybean yields. Estimates
of the South American crop size are beginning to decline. The
crop there will still be large, and probably larger than last
year's crop, but it may not live up to earlier expectations.
It now appears
that both the domestic crush of U.S. soybeans and the exports
of U.S. soybeans will be slightly larger than the current USDA
projection. Year ending stocks, then, may be less than the 270
million bushels currently projected. There is no danger of running
out of soybeans, with the South American harvest well underway,
but the higher rate of consumption and lower stocks would have
implications for the 2002-03 marketing year. The USDA's Prospective
Plantings report to be released at the end of the month will be
watched closely. A reduction in soybean acreage in the face of
record consumption would be somewhat supportive for prices. The
details of the "farm bill" may also have some implications
if there are changes in provisions that impact the 2002 crop.
University of Illinois