The USDA has hacked its 2024-25 Argentina soybean production estimate more deeply than expected, with global ending stocks tightening this month as well.
Tuesday’s USDA supply-demand update lowered projected 2024-25 Argentina soybean production estimate by 3 million tonnes from January to 49 million - now only 800,000 above the previous year’s crop – due to persistent heat and dryness in January. The Paraguay crop was trimmed as well, down 500,000 tonnes from last month to 10.7 million and below the 2023-24 crop of 11 million.
On the other hand, the Brazil crop was left steady from January at 169 million tonnes, up 10.5% from the previous year. Beneficial weather in Brazil’s center-west is boosting soybean prospects, but drier weather in the south accelerated soybean development at the expense of yields, the USDA said.
With production falling, the USDA pegged 2024-25 world soybean ending stocks for this month at 124.34 million tonnes. That is down 4 million tonnes from the January projection and well below the average pre-report trade guess of 127.79 million, although still above the 2023-24 stocks level of 112.49 million. Soybean futures were trading 3-4 cents/bu lower this afternoon, following the report’s release.
US soybean supply-demand estimates for 2024-25 were unchanged this month, with ending stocks holding at 380 million bu, compared to 342 million a year earlier.
Going into today’s report, traders and analysts were expecting a more modest reduction in the Argentina soybean production estimate, down to about 50.5 million tonnes. The trade was also expecting at least some of the lost production in Argentina to be offset by a slightly higher Brazil production estimate to 169.6 million tonnes.
With this month’s revisions, combined Brazil, Argentina, and Paraguay soybean production for 2024-25 is now estimated at 228.7 million tonnes. That is down 1.5% from the January projection of 232.2 million but still 7.7% higher year-over-year.
Estimated Argentina and Brazil soybean exports were unchanged from last month at 4.5 million and 105.5 million tonnes, respectively, compared to 5.11 million and 104.17 million a year ago. China imports were steady as well, holding at 109 million tonnes, down from 112 million in 2023-24.
The 2024-25 season-average soybean price is projected at $10.10/bu this month, down 10 cents from January. Soybean meal and oil prices are unchanged at $310/ short ton and 43 cents/lb, respectively.
