January 10, 2005
CORN AND SOYBEAN EXPORTS ON DIFFERENT PATHS
The USDA's final production estimates and
December 1 stocks estimates to be released on January 12 will
provide important fundamental information for the corn and
soybean markets. After the reports, however, the market will
continue to pay close attention to the development of the
South American crops and the pace of U.S. exports.
Corn and soybean export data are available from two USDA
sources as well as the Census Bureau. USDA data are available
weekly and Census data are available monthly, but with long
time lags. Export inspection data from USDA are currently
available through January 6, 2005 and export data from the
USDA's export sales report are available through December
30, 2004. Census data are available only for September and
October, the first two months of the 2004-05 marketing year.
The export data from all three sources are relatively consistent,
showing a strong pace of exports and a modest level of unshipped
sales. Through December 30, cumulative soybean export inspections
were reported at 531.4 million bushels, 4 percent larger than
the cumulative inspections a year earlier. Accumulated exports
in the export sales report totaled 539.7 million bushels.
An additional 28.3 million bushels were inspected during the
week ended on January 6, so that cumulative inspections were
5.8 percent larger than those of a year earlier. Through October,
the Census Bureau estimates of soybean exports were about
10 million bushels larger than the USDA estimates. This is
a smaller difference than is typically experienced.
Through December 30, 2004, exports to China were 17.4 percent
larger than exports of a year ago. China accounted for 46
percent of all U.S. exports. The European Union had imported
10.3 percent more U.S. soybeans than imported a year ago and
accounted for 18.2 percent of U.S. exports.
For the year, the USDA has projected U.S. soybean exports
at 1.01 billion bushels, 14.1 percent more than exported last
year. When compared to last year's pace, exports so far this
year would appear to be lagging the pace needed to reach the
USDA projection. Last year, however, 80 percent of the U.S.
exports occurred in the first half of the marketing year.
A more typical pattern is for 65 to 70 percent of the exports
to occur during the first half of the year. Inspections need
to average only about 13.4 million bushels per week from now
through August to reach the USDA projection. With unshipped
sales as of December 30, 2004 totaling 200 million bushels,
exports appear on track to meet the USDA projection.
The corn export data are not as consistent as the soybean
data. Through December 30, 17 weeks into the 2004-05 marketing
year, export inspections totaled 617.3 million bushels, 3.8
percent less than the total in the previous year. However,
accumulated exports in the USDA's export sales report totaled
646.2 million bushels as of December 30, nearly 30 million
bushels more than reported for inspection. In addition, Census
Bureau figures for September and October 2004 indicated that
exports were 16 million larger than reported in the export
sales report and 14 million more than exported in the same
two months in 2003. All of that year-over-year increase, however,
was in September, with October shipments about equal to those
of a year ago.
For the year, the USDA currently projects U.S. corn exports
at two billion bushels, 5.4 percent more than exported last
year. Exports followed a typical pattern last year, with about
half of the annual exports occurring in the first half of
the year. With cumulative shipments apparently running about
1 percent behind last year's pace and unshipped sales as of
December 30, 2004 trailing those of a year ago by 23.8 percent,
there is concern that the USDA projection will not be reached.
The key will be Asian demand and Chinese exports. Demand from
Taiwan currently appears a little soft, with export commitments
to that country running about 13 percent behind the pace of
a year ago. On the other hand, the USDA reported a sale of
about one million bushels to China during the week ended December
23, 2004. A continuation in the slow down of Chinese exports
and any additional purchases of U.S. corn by China would be
very supportive to U.S. export prospects. If new sales to
China do not unfold, the market may want to discount the USDA
projection of two billion bushels.
Issued by Darrel Good
University of Illinois