Anticipating the soybean stocks and acreage estimates
Seed and residual use of soybeans during the March-May quarter ranged from 11.7 million to 62.7 million bushels in the previous 10 years. The average use was 41.2 million bushels, very close to the average of 47.6 million bushels in the past two years. If use this year was at 47.6 million bushels, total consumption of U.S. soybeans during the March-May quarter would have been near 669.6 million bushels. With March 1 stocks of 992.3 million bushels and quarterly imports of 25.5 million bushels, June 1 stocks would have totaled 348.2 million bushels.
Unless June 1 stocks are 25 to 30 million bushels larger than expected, the domestic soybean crush during the final three months of the marketing year will have to be much smaller than during the same three months last year, and/or imports will have to exceed the projected level, in order to maintain year-ending stocks at a pipeline level. Stocks below the expected level would obviously require a larger drop in the domestic crush or increase in imports.
The USDA's March Prospective Plantings report revealed producer intentions to plant a record 81.493 million acres of soybeans this year, 4.96 million acres more than planted last year. The surveys for the June 30 Acreage report were conducted mostly in the first two weeks of June, so that forecasts of planted and harvested acreage will reflect some level of intentions. The USDA's weekly Crop Progress report indicated that eight percent of the soybean acreage was yet to be planted as of June 15, mostly double-cropped acres following wheat harvest. Much of the uncertainty about the June acreage forecasts relative to March intentions centers on northern producing states where wet conditions delayed corn planting and may have resulted in some switching to soybeans. Extreme wet conditions, however, may also result in some acreage not planted at all. Those prevented plantings may not all be revealed in the June surveys.
For the most part, expectations are that the upcoming forecast of planted acreage will not be smaller than March intentions. If large acreage is confirmed, prospects for a record large soybean crop and a build in stocks during the year ahead will be maintained. The potential U.S average yield and size of the crop will be indicated by the weekly crop condition ratings. In the first two reporting weeks, the percent of the crop rated in either good or excellent condition was record large. That percentage is expected to decline as the season progresses, as it almost always does, but will likely be above average for at least the next few weeks.
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