In anticipation of the release of the latest WASDE report (TBR: 12:15pm ET on May 12th), a further downward revision to the 2022/23 MY (Marketing Year) Argentinian crop is expected, with trade estimates ranging from 22-26 million metric tonnes compared to the 27 million metric tonnes predicted by the USDA in April and 43.9 million metric tonnes produced in the previous season. This season’s Argentinian soybean crop continues to be negatively impacted by dry weather conditions. According to the Rosario Board of Trade (BCR), the Argentinian soybean harvest reached 36.4% completion in the week ending 4th May, 8.2 p.p higher compared to the previous week, with 63% of the crop rated to be in regular to poor condition. The huge Brazilian crop this season and rising exports have continued to offset Argentinian losses, thus limiting price rises, with trade estimates ranging from 153.8-159 million metric tonnes ahead of the WASDE release, compared to current projections of 154 million metric tonnes. In May, soybean exports from Brazil are expected to continue to rise, with the National Association of Cereal Exporters (ANEC) estimating exports to reach 15.35 million tonnes in the month, an increase of 10% m-o-m from estimates reported in April. Despite the pressure from the record Brazilian crop, expectations of an expansion in US crush for the upcoming 2023-24 MY, lower than average carry-over stocks and China’s demand direction remain watchpoints for prices.
According to market sources, China’s soybean imports were down y-o-y in April due to the implementation of stricter quarantine checks by customs. With traders having to wait for the results of their quarantine checks before taking their deliveries, the new requirement, which has not been officially announced, has resulted in delays and longer waiting times for ships, raising concerns for importers.