Despite Record Supplies, Higher Soybean Prices Expected

(ARLINGTON, VA) Despite an outlook for record supplies, higher crush and exports, and lower ending stocks, USDA is projecting higher prices in 2019 for soybeans. Based on the information presented at the 95th Annual USDA Agricultural Outlook Forum, soybean supplies are projected at 5.1 billion bushels, up two percent from last year with higher beginning stocks more than offsetting lower production. Soybean production is projected at 4.2 billion bushels, eight percent below last year on a lower harvested area and trend yields. The national average soybean yield of 49.5 bushels per acre is just more than two bushels below last year. Domestic use is projected at 2.2 billion bushels, up one percent on higher crush. Lower soybean product exports reflect a recovery of Argentina’s crop after last year’s drought. Domestic use of soybean oil is projected up two percent on gains for edible oil and biodiesel consumption. But with lower projected soybean oil exports, soybean oil ending stocks for 2019/20 are projected to be three percent below last season. Soybean exports0 are projected at 2.03 billion bushels, up 150 million from the 2018/19 forecast, and with rising global demand and reduced supplies in Brazil this fall, some recovery in U.S. exports is expected despite continued import duties in China. Ending stocks for 2019/20 are projected at 845 million bushels, historically high, but down 65 million from last season. With a smaller harvest and a four percent increase in total soybean disappearance, the ending stocks-to-use ratio is projected at 19.8 percent, down from 22.2 percent. The soybean season-average farm price is projected at $8.80 per bushel, up 20 cents from last year.