WASDE: New crop projections lowered, still higher than soybeans last year

Posted August 12, 2009

USDA dropped its yield projections for the maturing U.S. soybean crop to 41.7 bushels per acre, nearly 1 bushel below the previous month's projections. That yield, however, is still 2.1 bushels per acre above last year's yield. The first survey-based forecast of U.S. soybean production given in the Aug. 12 World Agricultural Supply and Demand Estimates report was 3.2 billion bushels, 61 million below the July projection, but 240 million bushels above last year's crop.

Soybean stocks were projected at 210 million bushels, down 40 million from July as reduced supplies were only partly offset by reduced crush and exports. Soybean crush estimates were reduced 10 million bushels to 1.67 billion due to lower soybean meal exports. Soy oil use for methyl esters was unchanged from the July projections for 2009-'10 at 2 billion pounds, which compares with 1.7 billion pounds estimated for 2008-'09 use and 3.2 billion pounds of soy oil used for biodiesel in 2007-'08. Soybean exports were reduced 10 million bushels to 1.265 billion. Lower U.S. soybean and soybean meal exports were offset by increased shipments from Argentina.

USDA raised its projected prices for soybeans and soy products in this month's WASDE report. The U.S. season-average soybean price for 2009-'10 was projected at $8.40 to $10.40, up 10 cents on both ends of the range. Soybean meal prices were projected at $260 to $320 per short ton, up $5.00 on both ends of the range. Soybean oil prices were projected at 32 to 36 cents per pound, up one cent on both ends of the range.

Global oilseed production for 2009-'10 was projected at 422.6 million tons, down 0.9 million tons from last month, but still a record high. Soybean production for China was reduced 0.2 million tons to 15.4 million due to lower yield resulting from excessive moisture in the northeast. Offsetting increases were projected for soybean production in EU-27 and Ukraine. EU-27 rapeseed production was projected at a record 19.5 million tons, up 1.2 million due to better-than-expected yields reported during harvest, especially in Germany and Poland.

USDA also made some small adjustments to the final numbers for the 2008-'09 marketing year that left the ending stocks unchanged at 110 million bushels. The soybean crush was raised 5 million bushels to 1.66 billion reflecting a small increase in domestic soybean meal disappearance. Soybean exports were increased 5 million bushels to a record 1.265 billion.

For the corn crop, USDA projects a record corn supply of 14.5 billion bushels for 2009-'10, up 134 million for the previous record in 2007-'08. Sharply higher forecast corn production for the current year more than offset a reduction in carry-in as the 2008-'09 corn exports were raised 50 million bushels. Corn production for 2009-'10 was projected at 12.8 billion bushels, up 471 million as higher forecast yields more than offset a small reduction in harvested area as updated from the June 30 USDA Acreage report. Corn use was raised in spite of lower projected livestock feeding, with industrial use raised 100 million bushels due higher expected use for ethanol. The 2009-'10 marketing-year average farm price was projected at $3.10 to $3.90 per bushel, down 25 cents on both ends of the range.