In a February report, USDA experts slightly lowered their forecasts for world soybean production, consumption and exports, although the market had been expecting more significant reductions. As a result of the adjustment to beginning stocks, the ending stocks estimate was also higher than analysts had forecast. Overall, the soybean balance sheet remains relatively tight compared to last season, although the outlook for the Brazilian soybean crop is a cause for concern.
Compared to the January estimates, the new soybean balance for 2023/24 has undergone the following changes:
The initial stock estimate was raised by 1.7m tonnes to 103.57m (98.03m) due to an increase in Brazilian stocks of 2m tonnes, after soybean production in 2022/23 MY was revised up by 2m tonnes to a record 162m tonnes.
The global production forecast was lowered by 0.77 to 398.21 (378.06) million tonnes, particularly for Brazil – by 1 to 156 (162) million tonnes due to dry and hot weather in the states of Paraná and Mato Grosso, although the market was expecting a drop in the forecast to 153.2 million tonnes and the local agency Conab lowered the estimate by 5.9 to 149.4 million tonnes. For Argentina, the estimate was left unchanged for the time being.
Latest developments in world soybean import and export
The estimate for world exports was lowered by 0.37 to 170.57 (171.96) million tonnes, particularly for the USA – by 0.95 to 46.8 (54.21) million tonnes against the background of strong competition from Brazil and a drop in export rates in January. For Brazil, despite the reduced crop, the export forecast was raised by 0.5 to 100 (95.51) million tonnes thanks to substantial stocks and active shipments at the start of the year.
The world import estimate was lowered by 0.5 to 167.52 (164.38) million tonnes, mainly for the countries of Southeast Asia, while the estimate for China was maintained at 102 (100.85) million tonnes.
The forecast for world ending stocks was raised by 1.43 to 116.03 (103.57; 99.7 and 100.3) million tonnes (although analysts expected them to fall to 112.5 million tonnes), particularly for the United States and Brazil.
USDA report
According to the report, March soybean futures on the Chicago exchange rose 0.4% to $438.5/t (-3.4% compared to data after the January report), supported by a speculative rise in soybean oil prices to 2.5%.
The USDA experts also raised their forecast for world rapeseed production in 2023/24 by 0.3% to 87.4 (88.82) million tonnes, particularly for India, although the export estimate remained at 17.1 million tonnes.
World sunflower forecasts
The forecast for world sunflower production in 2023/24 was lowered by 0.47 to 55.08 (52.29) million tonnes, particularly for China – to 1.7 (1.9) million tonnes. At the same time, crop estimates remained unchanged for Ukraine at 14.5 million tonnes, the Russian Federation at 17.1 million tonnes, Argentina at 4.1 million tonnes and the EU at 10.2 million tonnes. The forecast for sunflower exports from Argentina was also lowered by 50 to 150 thousand tonnes and from the Russian Federation by 100 to 450 thousand tonnes, for Ukraine the estimate was left at 500 thousand tonnes and for Türkiye the import forecast was lowered by 100 thousand tonnes.
Improved weather in South America and an active soybean harvest in Brazil are weighing on the soybean market and neighbouring sunflower and rapeseed markets, exacerbating the fall in oil demand from China, where the economic crisis is worsening.