USDA reports have a lot of data hidden in pages of numbers, but one figure really stuck out for soybean traders Wednesday. The government forecast total Chinese imports of soybeans would be down from original expectations by almost 75 million bushels after purchases slowed in the first half of the marketing year.
Part of the deals may involve shipments out of Brazil cancelled due to shipping delays caused by port congestion. That's doesn't mean China didn't want the beans, however. Crush margins on imported oilseeds are still positive. This morning USDA confirmed the Chinese, as rumored, were still interested in buying from the U.S. Total Chinese purchases of old crop in the latest week totaled 19.3 million bushels. Though 8.1 million bushels of the deals were merely switched from purchases earlier attributed to "unknown destinations," the news helped send old crop May soybeans higher into the end of the overnight session this morning.
Soybean shipments also remain brisk, hitting 23.7 million bushels, four times the rate forecast by USDA for the rest of the marketing year that ends Aug. 31.
Net new bookings of beans came in well below trade guesses, however, because new crop purchases were slow. USDA said world carryout at the end of the marketing year would be greater than expected. That means increased South American production could linger on the world market, competing with new crop U.S. supplies at harvest this fall. That prospect weighed on new crop prices again this morning.
Total corn sales improved from last week to 18.7 million bushels, but most of that business was for new crop. Old crop bookings were just 7.3 million bushels and shipments of 11 million remain below the rate forecast by USDA, one reason the government lowered its forecast for exports again in Wednesday's supply and demand update. China did take a load of new crop, another indication that production there in 2013 is still a question market due to planting delays. Sound familiar?
Today's weekly report failed to confirm rumored sales of soft red winter wheat to China, but some deals finally showed up in the separate announcement made later under USDA's daily reporting system for large purchases. The agency said China bought 13.2 million bushels of new crop SRW from the U.S. That's still well below some of the numbers talked about when the rumors surfaced last week.