08/23/2018
With two weeks of reporting left in the marketing year for corn and soybeans, the corn export sales tally this morning was a little depressing. There were only 6.8 mln bushels of old crop sales, along with 41.5 mln new crop. The USDA forecast for old crop exports is 2.4 bln and there’s still 21 mln to go to hit that target. The ugliest part is the 225 mln unshipped bushels that have been sold, but not yet loaded for export. It doesn’t count towards the export tally until it’s shipped, so when you subtract those unshipped bushels from the current sales pace, that leaves 245.6 mln bushels of corn that need to make export inspections in the next two weeks to hit the target. Very close to a 0% chance that’s going to happen unfortunately.
Soybean sales this morning were reported at 5.6 mln bushels of old crop and 42.2 mln new. That’s bullish from the fact cumulative sales are now 2.159 bln bushels and the USDA target is 74 mln bushels below that at 2.085 bln. Granted, there’s also 156 mln bushels unshipped of that sales total, which means export inspections need to be 81.8 mln total in soybeans the next two weeks to hit the target, or they’ll get switched to new crop or cancelled. That’s unlikely to happen also, but it’s not as far fetched as the idea of corn making it to the finish line at the projected pace.
Wheat export sales were coming off of a monster bullish week last week of 29.5 mln bushels, but they fell on their face this morning with a big bearish 8.8 mln bushel total. If you add the last two weeks up, the average is 19.15 mln, which softens the blow some, but it’s still not over the 20 mln mark, which is what it takes just to be neutral these days. Keep that in mind, it use to be bullish wheat when sales were 20 mln even. Given how poor the export pace has been so far this marketing year, 20 mln is just a neutral number in today’s world. Gotta hit numbers like last week to get bulled up to wheat long term. Is there potential of that happening with reduced EU and Russian wheat production this year, yes. Is it happening yet though, absolutely not…, and therein lies the problem. Total sales in wheat, plus outstanding shipments of 314 mln bushels is 26% less than last year at the same time. USDA has wheat exports pegged to exceed last year by 199 mln bushels. Wheat needs some serious giddyup to hit that target.
Pete Loewen
Loewen and Associates, Inc
Pete Loewen / Matt Hines / Doug Biswell / Matt Burgener / Alex Gasper
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Twitter: @LoewenAgConsult @PeteLoewen