Porto Alegre, November 11th, 2024 – The November report from the United States Department of Agriculture (USDA), released last Friday (8), surprised the market by bringing significant cuts to US production and stocks for the 2024/25 season.
The market was even expecting some negative adjustments, but their size was surprising. We understand that the cuts do not make much sense, since the environment for crop development was considered excellent from the sowing period to the harvest, with no significant problems in the main states of the growing belt. In any case, the new numbers may bring some short-term relief to Chicago, but it is important to highlight that the forecasts still point to a large US crop, besides a significant increase in final stocks.
USDA indicated that the US soybean crop should reach 4.461 bln bushels in 2024/25, equivalent to 121.4 mln tons. Productivity was indicated at 51.7 bushels per acre, compared to 53.1 in the previous report. The number was below market expectations of 4.553 bln or 123.9 mln tons. In October, the estimate was 4.582 bln bushels or 124.7 mln tons.
Final stocks are projected at 470 mln bushels or 12.8 mln tons. The market was betting on a carryover of 535 mln bushels or 14.56 mln tons. In October, the number was 550 mln or 14.97 mln tons. USDA lowered its export forecast from 1.850 bln bushels (50.35 mln tons) to 1.825 bln bushels (49.67 mln tons). Crushing is now estimated at 2.410 bln bushels (65.59 mln tons), down from 2.425 bln bushels (65.99 mln tons) in October.
At the global level, USDA projected a soybean crop in 2024/25 of 425.4 mln tons. In October, the figure was 428.9 mln. For 2023/24, the forecast is 394.73 mln tons.
Ending stocks for 2024/25 are estimated at 131.7 mln tons, below the market forecast of 134 mln tons. Last month, the forecast was 134.7 mln tons. Stocks for the 2023/24 season are estimated at 112.4 mln tons. The market was expecting 112.3 mln tons.
For Brazilian production, USDA maintained its estimates of 153 mln tons for 2023/24 and 169 mln for 2024/25. For Argentina, the forecast for 2023/24 was raised from 48.1 mln to 48.21 mln tons. For 2024/25, the estimate is 51 mln tons, unchanged from the previous month.
Chinese imports in 2023/24 were maintained at 112 mln tons. For the next season, the forecast is 109 mln tons, repeating the previous month.
Safras News