Supply

U.S. Soybean Exports Record Large in July

The U.S. Census Bureau published official monthly export data for July 2019 on September 4. The data showed that shipments of U.S. soybeans were record large for July at 3.680 million tonnes. This was up 7.4% from 3.425 million tonnes, the previous record for the month, shipped in July 2018. China was the top destination at 1.938 million tonnes, or 53% of the total shipments, followed by Mexico (0.517 million), Indonesia (0.168 million) and Japan (0.135 million). China’s shipments were the highest monthly total since 2.099 million tonnes was shipped in February 2019 and July 2019 shipments were 195% above the previous record of 0.992 million tonnes for the month in 2016.

Looking at recent history on a calendar-year-basis, the current trajectory is for U.S. shipments to continue to rise into the end of the calendar year as new-crop supplies begin to move through the supply chain. What will be particularly interesting for the market will be the strength of shipments in August, where inspections data point to another notable increase from robust shipments in July. Weekly inspections suggest that August exports could rise to 4.735 million tonnes, which would also be record-large for the month.

Beyond August, however, remains in question as new crop (Sep ’19-Aug ’20) outstanding sales remain depressed compared with recent history. As of August 22, outstanding sales of U.S. soybeans totaling 5.614 million tonnes are just 42.5% of last year’s total and just 36.8% of the previous five-year average. Traders will look for that pace to increase in the coming weeks as buyers begin to secure coverage as South American supplies decline seasonally as cheapening U.S. offers regain market share.

Rob Hatchett
Rob Hatchett

Senior Economist

Doane Advisory Services