Anticipating the March 31 soybean stocks estimate
On March 31, the USDA will release an estimate of soybean stocks as of March 1. Typically, the most interest in the quarterly stocks estimates is focused on corn because these reports reveal the apparent pace of feed and residual use during the previous quarter and that USE is a very large component of total corn consumption. While seed, feed, and residual use of soybeans is a smaller component of total consumption, there has been enough variation in revealed consumption to provide market surprises from time to time. The March 1 soybean stocks estimate this year may be more important than is normally the case due to the rapid pace of U.S. exports, concerns about the size of the South American harvest, and prospects for generally tight stocks at the end of the marketing year.
Anticipating the size of the March 1 stocks estimate starts with the USDA estimate of stocks held on December 1, 2013 plus imports during the quarter. An estimate of consumption during December, January, and February is subtracted from that total in order to estimate stocks as of March 1. Consumption occurs in three categories: exports; domestic crush; and domestic seed, feed, and residual use. Stocks on December 1 were estimated at 2.148 billion bushels. Census Bureau estimates of imports in December and January totaled 5 million bushels, so the total for the quarter may have been near 8 million bushels, resulting in a total supply of 2.156 billion bushels. The Census Bureau also provides the export estimates used in the USDA's supply and demand balance sheets. However, those estimates are currently only available through January 2014. An estimate of exports for the entire quarter is based on a combination of Census Bureau estimates through January and USDA estimates which are available for the entire quarter. USDA export inspection estimates for the December-February quarter totaled 703 million bushels. However, Census Bureau estimates for December and January exceeded the inspection estimates by 16 million bushels. Assuming that margin persisted through February, exports for the quarter were near 719 million bushels.
Historically, the estimate of the size of the domestic crush was also based on monthly Census Bureau estimates. Those estimates were discontinued in July 2011. Monthly and quarterly estimates of the crush are now based on National Oilseed Processors Association (NOPA) monthly estimates of crush by its member firms and the historical relationship between those estimates and the Census Bureau estimates. That procedure results in an estimate of 486 million bushels for the crush during the December-February quarter.