U.S. Soybean Crushings Rebound in December

Rob Hatchett

Rob Hatchett

Doane Advisory Services

The National Oilseed Processor Association (NOPA) issued December soybean crush and stocks data on Wednesday, January 15. According to the data, NOPA member soybean processing in the third month of the 2019/20 product (October-September) marketing year totaled 4.758 million tonnes. December crushings were up 0.27 million tonnes from November and were the largest crushing for the month and also came in at the second-largest monthly total. Cumulative crushings of 14.109 million tonnes are up slightly from 13.909 million the same period last year.

According to analysts’ expectations published by Reuters, the trade was looking for crush to come in near 4.671 million tonnes with the highest published guess coming in slightly below the actual crushings at 4.736 million tonnes. The solid rebound in processing came after November crushings fell short of the trade’s expectations, which was attributed to limited farmer selling. The rebound in December suggests that improving crush margins, along with greater movement of new-crop soybeans were likely features that pushed processing rates.

The U.S. Department of Agriculture’s (USDA) January World Agricultural Supply and Demand Estimate (WASDE) report again maintained the agency’s previous forecast for crushings to rise nearly 1% from the 2018/19 marketing year to 57.288 million tonnes, and the latest NOPA data should help to preserve that forecast into the next report come mid-February. Expectations for continued strong demand from the U.S. livestock sector is seen as lending support to domestic protein meal demand, while a shutdown at one of Argentina’s largest soybean processor since early December is likely providing an unexpected boost to potential export demand for U.S. soybean meal.

Despite the modest increase in demand from the domestic sector, the outlook for U.S. soybean prices remains closely tied to offshore demand. USDA’s National Agricultural Statistics Service (NASS) is scheduled to publish its industry estimates for December on Monday, February 3.