U.S. Soybean Crushings Steady in August

Rob Hatchett

Rob Hatchett

Doane Advisory Services

The National Oilseed Processor Association (NOPA) issued August soybean crush and stocks data on Monday, September 16. According to the data, NOPA member soybean processing was slightly lower from July but set another record for the month at 4.574 million tonnes. Cumulative October-August NOPA crush is now running 0.8% above last year. This points to another likely increase for the soybean crush will be coming from the U.S. Department of Agriculture (USDA) in the October World Agricultural Supply and Demand Estimates (WASDE).

According to analysts’ expectations published by Reuters, the trade was looking for crush to come in near 4.409 million tonnes with the highest guess slightly above the actual at 4.599 million tonnes. While the trade was looking for a modest setback in processing as many analysts believed that July processing surged to make up for earlier unplanned downtime, August was expected to see a seasonal slowdown in processing as slipping crush margins and annual maintenance were seen as reducing run rates.

These data for August suggest that USDA is again understating crushing for September-August timeframe. In its September WASDE, USDA raised its 2018/19 soybean crush projection 544,000 tonnes to 56.744 million tonnes. Assuming that there is a normal relationship between the NOPA members and the U.S. crush industry as a whole in August, the final U.S. crush should total 56.962 million tonnes.

The soybean market has received a modest boost in prices since the September WASDE as smaller carry in supplies and reduced output were expected to lower new-crop U.S. soybean supply ideas in the marketplace. However, this slight increase to crushing is not expected to provide an additional spark to the market. Instead, the trade will likely maintain its focus in the weeks ahead on renewed U.S.-China trade talks and look to weather forecasts for indications as to how the 2019 U.S. soybean crop will finish its final, key production stages.

Source: NOPA Member data, https://apps.fas.usda.gov/psdonline/app/index.html#/app/advQuery