Ankeny, Iowa, USA
January 12, 2015
The 2014 soybean crop is one for the record books.
Grant Kimberley, Iowa Soybean Association (ISA) market development director, said today’s U.S. Department of Agriculture’s (USDA) final 2014 Crop Production and World Agricultural Supply and Demand Estimates (WASDE) reports — considered by traders as some of the most important assessments of the year — were “neutral” to soybeans. Despite record highs set for production, yield and harvested acres, a new milestone is likely for soybean exports during the 2014/15 marketing year and domestic consumption is up.
“We have off-the-chart record production in the U.S. and good global supplies, but there’s also great demand,” said Kimberley, who also farms in central Iowa. “There’s a strong appetite for soybeans and it continues to grow.”
The nation’s soybean harvest is pegged at 3.97 billion bushels, up 11 million bushels from November estimates and 18 percent higher than last year. The average yield is estimated at 47.8 bushels per acre, up .3 bushels from last month. U.S. farmers harvested a whopping 83.1 million acres of soybeans, up 300,000 from the previous forecast and 9 percent more than 2013.
Iowa farmers harvested a little more than 9.8 million acres of soybeans, data shows. Production is estimated at nearly 506 million bushels, with an average yield of 51.5 bushels per acre.
The small increase in national production is offset by demand. Soybean ending stocks for the 2014/15 marketing year remained unchanged from last month at 410 million bushels, according to government estimates.
Soybean exports were increased 10 million bushels to a record 1.77 billion bushels reflecting record sales during the first quarter of the marketing year, the WASDE Report said. Soybean meal balance sheet changes include increased imports and domestic consumption.
China continues to lead the charge as the world’s largest soybean buyer. As of late last week, the country has purchased 27 million metric tons or more than 992 million bushels of U.S. soybeans or 63 percent of all U.S. exports. Kimberley said soybean meal exports are strong as well, especially to Mexico, Thailand, the Philippines and other Pacific Rim nations.
“The world wants more protein,” he said.
Oilseed consultant John Baize of Falls Church, Va. considers the report bearish for the soybean sector.
“Analysts were expecting the USDA to slightly reduce its estimate for the soybean crop and to reduce ending stocks below 400 million bushels,” Baize said. “In addition, the USDA raised its forecast for Brazil’s 2015 soybean crop by 1.5 million metric tons to 95.5 million metric tons. While the changes were relatively minor, the net effect caused the market to fall.”
The 2014/15 U.S. season-average farm price for soybeans is projected at $9.45 to $10.95 per bushel, up 20 cents at the midpoint based on prices reported to date, according to the USDA.
Even though soybean prices are lower than previous years, they haven’t dropped as dramatically as corn. A recent survey by Farm Futures magazine said U.S. farmers intend to expand soybean plantings by nearly 5 percent to 88.3 million acres.
“Planting decisions are looming large in farmers’ minds and it is encouraging to see demand keeping up with production in this report,” said Tom Oswald, ISA president and farmer from Cleghorn. “We will now point our attention to the South American harvest as we prepare to make final planting decisions.”
To learn more about ISA, go to www.iasoybeans.com.
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