The U.S. soybean export forecast for 2016/17 is raised 1.4 million to a record 57.2 million tons this month on the strength of exports to date and outstanding sales to be shipped later. As of the week ending in June 29th, accumulated exports have reached 52.9 million tons, 18 percent above this time last year, and exceed total exports (including outstanding sales) in 2015/16.
Outstanding sales of U.S. soybeans for the current marketing year are also strong at 6.8 million tons, slightly below the record level observed in 2015/16. Last year’s large volume of outstanding sales so late in the marketing year was mostly triggered by supply tightness in South America.
This lack of availability along with competitive pricing prompted the increase in buyer interest in U.S. soybeans. This year, while interest in U.S. soybeans remains strong, the market dynamics driving buyers to the United States are different as lower prices following Brazil’s record production have spurred additional global demand.
Despite record post-harvest selling, Brazilian producers, facing these lower prices and a stronger real, have been more willing to store a larger percentage of this year’s crop in hopes that prices will rise. This has encouraged buyers to source additional product from the United States where supplies are flush and prices remain competitive.
The recent price increase could temper the U.S. export forecast, as the increased prices could spur additional Brazilian sales and dampen global demand, resulting in a larger than usual quantity of reported outstanding sales being pushed into the 2017/18 marketing year. Regardless, 2016/17 will prove to be a good year for US soybean exports.