USDA’s Latest Report Highlights Trends in Soybean Market for 2023-‘24

The USDA’s most recent report, issued on April 11, expects 13 billion pounds of soybean oil to be utilized for biofuel production in 2023-‘24, consistent with earlier projections, with no alterations to the anticipated price of soybean oil indicating stability in this aspect of the market.

In terms of U.S. soybean supply and demand expectations for 2023-’24, there are forecasts indicating reduced imports, residual use, and exports, accompanied by an increase in ending stocks. The USDA expects that 13 billion pounds of soybean oil will be utilized for biofuel production during this period, aligning with the March WASDE forecast. Soybean oil usage for biofuel production was recorded at 12.491 billion pounds in 2022-’23 and 10.379 billion pounds in 2021-’22.

The outlook for soybean trade has been adjusted downward due to current pace and future shipment forecasts. This adjustment, coupled with a slight decline in residual use, has resulted in a 25 million bushel increase in soybean ending stocks, reaching 340 million bushels. The anticipated average price for U.S. soybeans in the 2023-’24 season is set at $12.55 per bushel, reflecting a decrease of 10 cents. Notably, prices for soybean meal and oil remain stable at $380 per short tonne and 49 cents per pound, respectively.

Regarding global soybean supply and demand projections for 2023-‘24, there are indications of reduced production, exports, crush volumes, and nearly unchanged ending stocks. The decrease in soybean production is primarily attributed to adverse weather conditions in South Africa, negatively affecting yield potential. However, this decline is partially offset by increased production in Paraguay, which has been raised by 200,000 tonne to 10.5 million.

On the export front, global soybean exports have been lowered by 500,000 tonne to 173.1 million, mainly due to reduced exports from the United States and South Africa, although this is partially balanced by increased shipments from Paraguay. Import estimates have been revised downward for several countries, while the EU’s import forecast has been raised.

Despite these adjustments, global soybean ending stocks remain relatively stable, with higher stocks projected for the United States but offset by lower stocks for Canada, Iran, and Russia. This suggests a mixed outlook globally, with production challenges in some regions being offset by production increases elsewhere, affecting export and import dynamics as well as ending stock levels.

In terms of price, the projected U.S. season-average soybean price for 2023-‘24 is set at $12.55 per bushel, down slightly from previous estimates. However, soybean meal and oil prices are expected to remain steady at $380 per short tonne and 49 cents per pound, respectively.