WASDE: US soy exports cut, South America production unchanged

The December World Agriculture Supply and Demand report has cut soybean export expectations for the 2017/18 marketing year as “stronger-than-expected” competition from Argentina and Brazil has edged out typical US export flows.

Exports are expected to reach 2.225 billion bushels, down 25 million bushels.

Production from South American rivals Argentina and Brazil was left unchanged at 57 and 108 million mt respectively, both within range of expectations, but surprising some who had anticipated a reduction in Argentina’s production levels and an increase in Brazil’s.

The report also revised the ending stocks to 445 million bushels, a rise of 20 million bushels but still within the range of 425 million to 486 million that analysts had expected, while total use gave up 20 million bushels to 4.306 billion bu.

Other modest changes saw world production pared fractionally back to 348.47 million mt, down from 348.89 million mt and ending stocks increased to 98.32 million mt, up from 97.9 million mt in November’s report – again, well within the range expected by analysts.

The immediate reaction to the news sent soybean futures into fresh falls, with the front month January contract on CBOT losing a shade over 5 cents to $9.7725/bu at time of writing.