Export Demand For U.S. Soy Rising
Rising Brazilian soybean export premiums are seen boosting demand for U.S. soybeans in coming weeks even though overall Chinese imports are slowing because that country has large imported soybean stocks to work through.
News reports on August 9 indicated export basis levels for Brazilian soybeans had risen by 30 cents/bu. over the past week, to about 60 cents over Chicago Board of Trade (CBOT) November futures on a Free-On-Board (FOB) basis.
At that level, Brazilian soybeans for September shipment are actually priced higher than U.S. beans. U.S. soybeans FOB the Gulf were priced at 53-56 cents over CBOT November on August 9.
Brazilian exporters are said to be facing short supplies of soybeans because falling futures prices and a strong Brazilian real have slowed farmer selling.
USDA export sales reports released on August 10 supported indications that foreign buyers are shifting to U.S. soybeans. USDA pegged soybean export sales for the week ended Aug. 3 at 19.9 million bushels, above trade expectations of 7.5-14.5 million bushels.
And USDA also announced that U.S. exporters had reported fresh sales of 226,000 metric tons of U.S. soybeans to China for 2006-07 shipment.
China’s soybean imports slowed during July after reaching a record monthly level of 3.67 million metric tons during June. Official Chinese customs statistics indicate that soybean imports during July totaled 2.39 million metric tons, down 16.4% from July 2005.
However, China’s January-July 2006 soybean imports of 16.45 million metric tons were still up 10.6% from the same period a year earlier.
According to Reuters News Service, analysts expect Chinese crushers to slow imports in the coming two months, with August arrivals expected to run 2.2 million tons and September arrivals seen at around 2 million tons.
Editors note: Richard Brock, The Corn and Soybean Digest's > Marketing Editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.
To see more market perspectives, visit Brock's Web site at