China Demand for U.S. Soybeans Still Hot
Market watchers thinking buying had fallen got a surprise last week.
Compiled by staff
Published: Nov 13, 2009
Just when it looked like Chinese demand for U.S. soybeans might be tapering off, the world’s largest importer went on another buying spree last week, according to the latest export totals released by USDA.
The government said total sales for the week hit 46.8 million bushels, more than doubling trade guesses. China took more than 75% of the total, despite ongoing worries that record production in South America could lure earlier than normal purchases from Brazil and Argentina.
Shipments were also red-hot, topping 60 million bushels to set a marketing year high. Commitments to date account for 68% of the government’s forecast for the marketing year, even though USDA raised its sales projection in this week’s updated supply and demand report.
Corn sales, by contrast, continue to struggle with the total for the week, 19.2 million bushels, falling below both trade guesses and the weekly rate needed to meet USDA’s lowered forecast for the marketing year. While Japan returned to the sales column, taking almost 12 million bushels, other Asian buyers were noticeably absent. Smaller customers are seeking out alternative sources, such as Thailand or India, while larger buyers take feed wheat or less than offered.
New worries about vomitoxin and other quality issues caused by the wet early fall are also encouraging buyers to go slow.
Quality concerns are also heating up in the wheat market, where loads are being routinely rejected or held for further testing. Still, buyers appear to want to have their cake and eat it, too, because many remain extremely price sensitive as well. Egypt bought another 11 million bushels from Russia Thursday, snubbing the U.S. again, even as it tries to iron out problems with shipments out of the Black Sea.
Wheat exports for the week totaled 15.1 million bushels, a little better than estimates and the rate needed to meet USDA’s lowered total for the marketing year.
For the complete export report, click here.
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Weekly Export Sales (million bushels)
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AS OF WEEK ENDING
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11/5/09
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Actual
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Last Week
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Trade Est.
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USDA F'cast
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Export Ship-ments
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USDA F'cast
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% of USDA Commit.
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Ave.
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% of USDA Ship-ments
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Ave.
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Wheat
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15.1
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10.5
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13.8
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12.5
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16.9
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17.8
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57%
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58%
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40%
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42%
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Corn
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19.2
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22.5
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21.7
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26.0
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29.8
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35.2
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34%
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35%
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16%
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17%
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Soybeans
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46.8
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19.3
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23.0
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12.9
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60.1
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19.6
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68%
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51%
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20%
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22%
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Source: USDA, Reuters
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Tagged: usda, wheat, soybeans
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