Unveils bullish triggers for the medium term
Key variables | May USDA |
Apr USDA |
Abs chg (May vs. Apr) | Impact Assessment |
Crop Year 2011/12 | ||||
US Soybean Crush, Mn Bu | 1645 | 1630 | 15 | Price impact could be limited as focus shifts towards new crop. Yet, it shall reduce the old crop carryin. |
US Soybean Exports, Mn Bu | 1315 | 1290 | 25 | Official confirmation of the surge in weekly exports to china. Shall reduce old crop carryin. Price impact is positive. |
US Soybean Ending Stocks, Mn Bu | 210 | 250 | (40) | Below the threshold 250mn bu and hence positive for the market. |
US Soy oil production, Mn Lbs | 19055 | 18780 | 275 | Direct result of rise in soybean crush. Higher supplies could initially weigh on the sentiment. |
US Soy oil stocks Mn Lbs | 2565 | 2290 | 275 | Additional stocks with just a few months to close the old crop year are deterrent for market, hence negative. |
Crop Year 2012/13 | ||||
US Soybean acreage, Mn Acres | 73.9 | -- | -- | Acreage is same as per Mar’12 intentions report. But the current brisk planting pace could lead to higher final acreage. Potentially discouraging for long term price trend. |
US Soybean yield, Bushels/acre | 43.9 | -- | -- | This is the trend line yield and as the current year yields are poor, a recovery can be expected in the new crop. However, weather risk remains as EL-Nino/La Nina indicators are highly variable. |
US Soybean Ending Stocks, Mn Bu | 145 | -- | -- | Sharp drop as a result of rising crush and exports particularly during 1st half of the next marketing year. Potentially bullish for prices. |
Crop Year 2011/12 | ||||
China Soybean Imports in Mn Tons | 56 | 55 | 1 | Clear indication of constrained SA crop and the shift in demand to US. Neutral to positive as prices have already factored in. |
Brazil Soybean Production in Mn Tons | 65 | 66 | (1) | Official confirmation of the lower crop in Brazil and Argentina, stands supportive to the sentiment. Potentially bullish in the medium term. |
Argentina Soybean Production in Mn Tons | 42.5 | 45 | (2.5) | |
World Soybean Ending Stocks, Mn Bu | 53.2 | 55.5 | (2.3) | Multi year low stocks and sharply lower compared to last year’s 70mn tons. Medium term bullish. |
World Veg Oil Ending Stocks, Mn Tons | 13.16 | 12.6 | 0.56 | Incremental stocks as a result of increased soy crush in US and rise in oil stocks. Bearish as new crop supplies from US could turn bigger. |
Crop Year 2012/13 | ||||
China Soybean production in Mn Tons | 13.1 | -- | -- | Lower on yoy basis and could create incremental demand from the world’s largest consumer. Potentially bullish for medium to long term |
China Soybean Imports in Mn Tons | 61 | -- | -- | Steep rise of 5mn tons on yoy basis leaves less room for any kind of supply threats pertaining to te new crop. |
World Veg Oil Ending Stocks, Mn Tons | 12.3 | -- | -- | Projections above 12m tons which is discouraging for sustained price surges. Much shall depend on the US crop size and the extent of increase in Malaysian palm oil production given the looming weather anomalies. |
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