Ram Gopal Yadav

The outlook for global soyabean production in 2017/18 is cut by 2m t m/m, to 347m, down by 1% y/y, including a reduced figure for Argentina. However, due to an increased estimate for carry-ins, supplies are forecast higher m/m and, with uptake reduced, carryovers are raised to 44.1m t, slightly lower y/y. Trade is little changed m/m, at a peak of 153m t, up by 4% y/y. The world harvested area is tentatively projected at a new high in 2018/19, including gains in Brazil and the USA. World soyabean output is forecast at 347m t in 2017/18, only 1% lower than the prior year’s peak as record crops in North America mostly compensate for reduced outturns elsewhere. Total use is predicted at a new high, with aggregate end-season stocks likely to fall. However, major exporters’ inventories are seen broadly steady y/y as heavy accumulation in the USA offsets significant falls in Brazil and Argentina. Trade could be a new high on bigger sales to Asia, while a modest recovery in deliveries to the EU is expected. The Council’s outlook for soyameal trade is for a record of 63.8m t, up by 3% y/y on increased demand from buyers in Asia and Africa. Given prospects for a disappointing soyabean crop, availabilities in Argentina, the world’s dominant supplier, are expected to tighten, with exports seen down by 6% y/y. However, this should be outweighed by bigger shipments by the USA and Brazil. Concerning tentative prospects for 2018/19, the world soyabean harvested area is projected to be up 2% y/y, including gains in the USA and Brazil. Trade will again be shaped by China’s appetite for imports

The Argentinian soybean crush for January was reported at 2.8 million mt, up 25% from December, but down 8% year-on-year. The figures come at a time when private analysts are estimating a steep fall in Argentina’s crop production, with many now predicting the nation will produce 50 million mt or less, down at least 15% on the previous year. However, the 2018 January crush was up 10% from the five-year average and the third highest recorded for Argentina in 10 years.

Soybean contracts on the CBOT were down because of profit booking by the investors ahead of the annual USDA conference. The most active May futures on the CBOT was down 0.3% at $10.4225 a bushel. The annual USDA conference will release acreage estimates for upcoming US crop planting at its two-day meeting. Profit booking was also seen in the contract after it hit an 11-month high of $10.50 per bushel due to concern over hot and dry weather in Argentina which may hit the output there.

Prices of soybean in Indore were up, tracking gains on CBOT. Lower supplies in the market and hot-and-dry weather in Argentina is seen supporting domestic soybean prices. Although arrivals are steady in the state, they are insufficient to meet demand.