The slow-down in near-term Chinese soybean buying gathered momentum last week, when the world's largest soybean importer cancelled 10.3 million bushels of previous purchases from the U.S. That caused net new bookings of 2012 crop beans to fall 7.6 million bushels, a marketing year low that took some of the steam out of the bean market's rally overnight.
China's old crop purchases have fallen sharply in recent weeks, with some deals with Brazil also washed out after delays shipping the product due to port congestion provided a convenient excuse. With crush margins falling on softer demand, Chinese imports are following suit as economic growth slows down. Fears of a bird flu outbreak spreading may also be working into the weaker demand.
China continues to book new crop beans from the U.S. aggressively. USDA has announced the sale of 28 million bushels alone this week, under its daily reporting system for large purchases, most of them attributed to China.
Even with this week's reductions, sales and shipments to for the 2012 crop year are only 11 million bushels below USDA's forecast for the entire year. Only 5.5 million bushels need to be shipped every week through the end of the summer to meet the government's projection. Shipments in the latest week totaled 7.1 million bushels.
Corn exports are expected to fall to an all-time low for the modern era this week, but the news has picked up a little lately. Weekly sales of old crop were decent at 12.4 million bushels. And USDA announced the sale of 21.3 million more bushels of new crop today to China and unknown destinations under its daily reporting system for large purchases.
China corn imports increased this year due to stronger livestock demand and quality problems caused by excess moisture over the fall and winter that also delayed new crop seedings.
Wheat sales were sluggish this week, reflecting a market where buyers appear to be waiting as long as possible on new deals, until more is known about new crop potential in the northern hemisphere. Total exports came in at 11.3 million, with only 2.6 million of that for old crop after cancelations of some white wheat and durum.