Weekly U.S. soybean export shipments are typically on the lower end of total marketing year volumes for this time of year. But exporters had a surprise for market watchers today, as strong soybean volumes to Mexico and Southeast Asia over the past week propelled soy shipments for the week ending July 22 to 8.9 million bushels in USDA’s weekly Grains Inspection for Export report released this morning.
If Thursday’s Export Sales report from USDA confirms today’s total, it would be the largest weekly export volume for U.S. soybeans in over a month, after supply concerns and negative crushing margins in China dampened usage outlooks.
But China was only a minor player in the soy market last week, snapping up a scant 115K bushels from U.S. exporters. Mexico was the top destination for U.S. soybeans last week, with over 3.9 million bushels shipped to our neighbor to the south last week, accounting for 44% of total weekly U.S. soybean shipments. Bangladesh followed with 2.2 million bushels shipped from U.S. shores last week.
Markets will likely continue to wait for signs of life from Chinese export buyers this week. China is not likely to book any further shipments of 2020/21 soybeans as U.S. exportable supplies run low and crush margins in China remain tight.
But old crop purchases from other global buyers – especially number two buyer Mexico – will be critical in the coming weeks if 2020/21 export goals of 2.27 billion bushels, as outlined in the latest WASDE report, is expected to be met before August 31.
China, Africa compete for U.S. wheat
Wheat harvest is underway across the U.S. and international buyers are taking full advantage of the freshly available wheat stocks, despite recent rallies over the past week on international supply concerns.
For the week ending July 22, U.S. wheat inspected at export terminals measured at 17.6 million bushels, a 2-million-bushel weekly decline.
Soft red winter wheat continued to dominate the international wheat pipeline last week. Wheat exports out of the Gulf of Mexico topped out at 7.7 million bushels, or nearly 44% of all U.S. wheat exports for the week ending last Thursday. African countries Djibouti, Nigeria, Somalia, and Sudan snapped up 6.4 million of those bushels shipped out of the Gulf last week.
Top international destinations for U.S. wheat shipments last week included China with 4.1 million bushels and Mexico with 3.3 million bushels. China has recently finished up its wheat harvest, though rains and growing hog volumes could put a dent in the new supplies.
This morning’s data suggests that China is not likely to curb its interest in U.S. wheat any time soon. However, increasing purchases from African nations could give China a run for its money in the global wheat market in the short run.
Corn volumes edge lower
U.S. exporters weighed 40.8 million bushels of corn destined for international channels for the week ending July 22. It marked a 4% decrease in shipping volumes from the previous week. Weekly corn shipping paces have slowed over the past month as high prices put a damper on peak shipping season for U.S. corn exporters.
But for the week ending July 22, corn shipments to China remained strong. Over 19.4 million bushels of corn, or 48% of the weekly total, were weighed for inspection en route to China for the week. The U.S.’s next two largest buyers this year, Mexico and Japan, snapped up 8.4 million and 9.9 million bushels, respectively, over the past week.
The Gulf was the top export terminal for corn last week, shipping nearly 18.6 million bushels of corn into international channels.
High corn prices may continue to slow export rates as peak corn export season winds down. But today’s report shows that China remains a steady buyer of U.S. corn despite more corn acres, a recent wheat harvest, and last week’s projections that Chinese purchases of foreign grain stocks could decline in the coming marketing year.