CHICAGO (Reuters) — Export demand for U.S. soybeans slowed last week, U.S. Agriculture Department data released on Thursday showed, but further declines in overseas purchases were needed to provide relief to a tight balance sheet.
USDA’s weekly export sales report showed net sales of U.S. soybeans for delivery during the 2013-14 crop year were just 11,900 tonnes, the second smallest since the marketing year began in September.
The report pushed total U.S. soybean exports for the marketing year above USDA’s forecast of 1.53 billion bushels, said Arlan Suderman, grains analyst at Water Street Solutions. Typically, exporters have sold 89 percent of their yearly soybean shipments by late March, he added.
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Buyers did cancel purchases totaling 242,800 tonnes in the week ended March 20, including 170,000 tonnes from unknown destinations, which many analysts said likely included washed out deals from China.
China backed out of agreements to buy 268,300 tonnes of old-crop soybeans two weeks ago and the trade has been closely watching for more cancellations. Poor crush margins have cut into processors’ profits in that country and demand from poultry producers was waning due to an outbreak of avian flu.
More cancellations were needed to ensure U.S. supplies do not run out before the fall harvest. Analysts are expecting a USDA report on March 31 will show the domestic stockpile as of March 1 fell to a 10-year low.
USDA said China, the world’s top buyer of the oilseed, booked deals to import another 21,700 tonnes of old-crop soybeans in the latest week. Analysts had expected that by now Chinese buyers would have shifted their interest to South America, where recently harvested soybeans from Brazil and Argentina were available for cheaper prices.
China also canceled a purchase of 9,500 tonnes of U.S. corn, adding to the more than 900,000 tonnes of cancellations during the current marketing season tied to the presence of an unapproved variety of genetically-modified corn.
Overall, corn export sales remained robust, with 1.4 million tonnes of old-crop supplies sold in the latest week. That was the largest in three weeks and roughly double the high end of analyst expectations.
Egypt was the lead corn buyer, with a bulk of their 431,100-tonne purchase announced last week in a “flash sale” of 340,000 tonnes. Egypt, Colombia, Japan and Morocco each had a portion of their sales switched from unknown destinations.
