WASHINGTON, March 9 (Reuters) – Soybean futures are trading down more than one percent Thursday following a USDA supply and demand report that raised its outlook for Brazilian soy production and lowered the forecast for American soybean exports.
With the reduced exports, U.S. soybean year end supplies will be bigger than expected, the government said.
The U.S. Department Agriculture raised its outlook for U.S. soybean end stocks for the 2016-17 marketing year by 15 million bushels to 435 million. The bump reflects a 25 million bu. reduction in U.S. soybean exports, which is partially offset by a 10 million bu. increase in soybeans crushed by domestic processors.
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The average of estimates in a Reuters poll of analysts had expected the report to show soybean ending stocks of 418 million bu. Estimates had ranged from 400 million bu. to 444 million bu. .
The government held its domestic corn year end stocks view and export forecast steady despite raising the outlook for Brazil corn production.
It cut its outlook for domestic wheat ending stocks by 10 million bu. due to a reduction in imports.
USDA pegged U.S. corn end stocks at 2.320 billion bu. and wheat end stocks at 1.129 billion bu. That was close to the average of analysts’ forecasts of 2.317 billion bu. for corn and 1.135 billion bu. for wheat.
It raised its forecast for the Brazil soybean crop, which is currently being harvested, to 108 million tonnes from 104 million tonnes, above the average of analysts’ estimates which was 106 million.
“The crop has benefited from favourable weather with ample rainfall throughout the growing season, raising the prospects for record yields,” USDA said in the report.
It raised corn production in Brazil five million tonnes, to 91.50 million.
USDA left its soy production estimate for Argentina, another key exporter, unchanged at 55.50 million tonnes. The corn crop in Argentina was seen at 37.50 million tonnes, up 1 million tonnes from a month earlier.
The government raised its estimate of world ending stocks for corn and soybeans to account for the increased South American production.
It pegged global corn ending stocks at 220.68 million tonnes, up from 217.56 million tonnes a month ago, and global soybean ending stocks at 82.82 million tonnes, up from 80.38 million tonnes.
Global wheat ending stocks were raised to 249.894 million tonnes from 248.61 million tonnes.
