USDA slightly lowered its forecast for global oilseed production

In the December report, the USDA experts lowered the forecast of global oilseeds production by only 0.46 mln tonnes to 661 mln tonnes due to the reduction of soybean crop in Brazil, which will be offset by the increase of rapeseed crop in Canada and Australia.

Compared to the November estimates, the December soybean balance for 2023/24 MY has undergone the following changes:

• Estimate of beginning stocks increased by 1.6 to 101.92 (98.06) million tons after the increase in the estimate of soybean production in Brazil in 2022/23 MY by 2 to 160 million tons.
• The global production forecast was lowered by 1.54 to 398.88 (374.39) mln tonnes, in particular for Brazil – by 2 to 161 (160) mln tonnes due to heat and drought in Mato Grosso and the northeast of the country. This is partially offset by an increase in harvest in Canada and Russia.
• The estimate of world exports was increased by 2 to 170.29 (171.12) million tons, in particular for Brazil – by 2 to 99.5 (95.5) million tons amid an increase in initial stocks after adjusting data on the harvest in 2022/23 MY.
• The import estimate for China was increased by 2 to 102 (100.85) million tons due to active purchases at the beginning of the season.
• The forecast of world ending stocks was lowered by 0.3 to 114.21 million tons (101.92 million tons in 2022/23 MY, 99.7 million tons in 2021/22 MY and 100.3 million tons in 2020/21 MY), while analysts estimated them at 112.76 million tons. For Brazil, the stocks estimate was lowered by 2 million tons, and for China – increased by 2 million tons.

According to the report, January soybean futures on the Chicago Board of Trade fell by 0.5% to 479.1 $/t (-1.8% compared to the date of the November report), and March futures are trading at 486 $/t.

At the same time, USDA raised the forecast of global rapeseed production in 2023/24 MY by 1.4 to 87 (88.82) mln tonnes, in particular for Canada – by 1 to 18.8 (18.7) mln tonnes and Australia – by 0.4 to 5.5 (8) mln tonnes. As a result, the forecast of rapeseed exports for Australia was increased by 0.2 to 4.4 mln tonnes and for Canada – by 0.2 to 7.7 mln tonnes, while for Ukraine it was decreased by 0.2 to 3.45 mln tonnes.

The forecast of the world sunseed production in 2023/24 MY was decreased by 0.18 to 56.8 (52.38) mln tonnes, in particular, for Argentina – by 0.2 to 4.5 mln tonnes.

the Brazilian Agency CONAB has reduced compared to the estimates of November forecast soybean production in the country by 2.24 to 160,18 million tons, although the estimate of sowing areas left at 45.3 million hectares, which is 2.8% higher than last year. Brazilian soybean exports in 2023/24 MG is estimated at 109.59 million tons, while the USDA forecasts it at 99.5 million tons.

Therefore, since the end of January, soybean supplies from Brazil will increase pressure on world prices.

Tags: soybean, USDA Report, sunseed, rapeseed