The USA started a soybean harvesting campaign on September 22nd. At this point, the campaign is completed only by 3%, which is much less than 6% - the 5-year average. As for the condition of the crops, there have been no major changes since last week. 50% of the crop is in good and excellent condition, 33% is in satisfactory condition, 17% is in poor condition.
In general, major soybean-growing states expect good weather conditions that will favor the harvesting campaign.
On top of that, the weather in Brazil is humid, which will contribute to the sowing campaign that is about to start.
The export sales during the period of September 13th – 19th reached 442.5 000 tons. The net sales with delivery in 2013-2014 are around 2.8 million tons (against expected v million tons).
The chart shows that the net sales figures have exceeded the 5-year average by 17% (as of last week). On the other hand, the inspected sales are still lagging behind the 5-year average by 2.3%:
As for seasonality, we may expect growth since early October. Still, the sowing and harvesting campaigns were delayed, which means the seasonal factor will also come with a certain delay, at least till the start of the sowing campaign in Brazil.
According to Lanworth, the global production of soybeans in the 2013-2014 marketing year will increase from 281 million tons (previously expected) up to a new record – 284 million tons. The USDA’s forecast is 281,66 million tons.
The bottom line:
The global market of soybeans will come under the pressure of the harvesting campaign in mid-term perspective. Still, higher global demand may provide extra support.
Courtesy of the Commodity Trading Department of Masterforex-V Academy:
