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Oil Crops Outlook Summary (OCS-17j, October 16, 2017)

Core Content

This report provides an outlook for U.S. and global oil crops for the 2017/18 marketing year, focusing on soybeans, canola, sunflowerseed, and other oilseed crops. It outlines production forecasts, supply and demand expectations, and stock levels, highlighting the impact of weather conditions and market dynamics on crop yields and availability.

Key Highlights

U.S. Soybean Outlook

• Sown Acreage: Increased by 694,000 acres to a record 90.2 million.
• Production Forecast: Reduced by 422,000 bushels to 4.431 billion due to lower yields.
• Yield Forecast: 49.5 bushels per acre, down from 49.9 bushels last month.
• Beginning Stocks: Lower than expected at 301.3 million bushels.
• Season-Ending Stocks: Reduced from 475 million to 430 million, aligning with the drop in beginning stocks.
• Price Forecast: Unchanged at $8.35–$10.05 per bushel.

Global Soybean Outlook

• Global Production: Forecast down 0.6 million metric tons to 347.9 million.
• Ukraine: Production reduced by 600,000 tons to 4 million due to drought.
• EU Imports: Reduced by 500,000 tons to 14 million, impacted by Ukraine's lower supplies.
• U.S. Soybean Exports: Reduced by 450,000 tons to 2.5 million, down from 2016/17.
• U.S. Domestic Crush: Reduced by 100,000 tons to 900,000 due to lower supplies.

Domestic Outlook

Soybean

• Soybean Supply and Disappearance:
  • Planted Acreage: 90.2 million.
  • Harvested Acreage: 89.5 million.
  • Yield: 49.5 bushels per acre.
  • Beginning Stocks: 301.3 million bushels.
  • Production: 4.431 billion bushels.
  • Imports: 25 million bushels.
  • Total Supply: 4.757 billion bushels.
  • Crush: 1.940 billion bushels.
  • Seed & Residual: 137 million bushels.
  • Exports: 2.250 billion bushels.
  • Total Use: 4.327 billion bushels.
  • Ending Stocks: 430 million bushels.

Canola

• Acreage: Reached a record 2.1 million acres, up 21 percent.
• Production: Forecast down 9 percent to 2.8 billion pounds due to below-trend yields.
• Yield: 1,383 pounds per acre, down from last year's 1,824 pounds.
• Crush: Forecast at 4.15 billion pounds, down from 4.4 billion.
• Imports: Expected to increase to 1.6 billion pounds from 1.5 billion.
• Ending Stocks: Forecast at 930 million pounds.

Sunflowerseed

• Production: Forecast at 1.81 billion pounds, down from 2.65 billion.
• Acreage: Reduced by 14 percent to 1.2 million acres.
• Yield: Forecast at an 11-year low of 1,339 pounds per acre.
• Crush: Forecast at 930 million pounds, down from 1.2 billion.
• Beginning Stocks: At an 11-year high of 494.5 million pounds.
• Harvest Progress: Only 6 percent complete as of October 8.

Other Oilseeds

• Cottonseed:

  • Production: Forecast at 6.676 million short tons.
  • Crush: 2.4 million short tons.
  • Exports: 360,000 short tons.
  • Other Use: 3.9 million short tons.
  • Ending Stocks: 415,000 short tons.

• Peanuts:

  • Production: Increased by 5 million pounds to 7.786 billion.
  • Yield: Record at 4,257 pounds per acre.
  • Harvest Progress: 39 percent of acreage harvested as of October 8.

International Outlook

Global Soybean

• Production: Forecast at 347.9 million metric tons, down 0.6 million from last month.
• Ukraine: Production reduced by 600,000 tons to 4 million.
• Russia and U.S.: Both experienced crop reductions due to drought.
• EU Imports: Reduced by 500,000 tons to 14 million.
• Rapeseed Imports: Expected to increase to compensate for reduced soybean supplies.

Global Sunflowerseed

• Production: Forecast at 46.3 million tons, down 1.1 million from last month.
• Ukraine: Reduced by 500,000 tons to 13.5 million.
• Russia: Reduced by 330,000 tons to 10.5 million.
• Ukraine Crush: Reduced by 150,000 tons to 13.45 million.
• Exports: Reduced by 100,000 tons to 5.15 million.

Australian Canola

• Production: Forecast down 200,000 tons to 3 million due to worsening drought.
• Yield: 1,383 pounds per acre, down from 1,824 pounds.
• Exports: Reduced by 100,000 tons to 2.5 million.

Summary of Key Trends

• U.S. Soybean Production: Higher acreage did not offset lower yields, resulting in a reduced forecast.
• Global Soybean Supply: Tightened due to reduced production in key regions like Ukraine and Russia.
• Sunflowerseed Supply: Domestic production is down, but high beginning stocks help stabilize prices.
• Canola and Peanut Yields: Canola yields are down due to drought, while peanuts show a record yield.
• Market Dynamics: Reduced domestic supplies may lead to increased imports, but global constraints could limit availability.
• Price Trends: Prices for soybean oil and canola have been rising, particularly in Central Illinois and due to reduced supply.