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USDA sees soybean stocks soaring to record as China tariffs hit exports

Jul. 12, 2018 6:37 PM ETSGG, DBA, RJA, JJA, JJGTF, COW, UAG, GRU, AGF, UBC, FUD, AGA-OLD, ADZ, DAG-OLD, JJS, CORN, SGAR, CANE, SOYB, WEAT, DIRT, WEET, LSTK, GRWN, CTNN, TAGS, USAG, BALBy: Carl Surran, SA News Editor10 Comments
  • Soybean prices fell to their lowest in nearly a decade after the U.S. Department of Agriculture forecast domestic supplies will rise to the highest ever on expectations that tariffs in China, the world’s largest soybean purchaser, will cut into exports.
  • In its monthly supply and demand report, the USDA forecast stocks of soybeans for the 2018-19 crop year will come in at a record 580M bushels, far above its estimate of 385M bushels issued a month ago before China imposed tariffs on imports of U.S. soybeans.
  • The USDA sees soybean exports falling 11% next year to 2.04B bushels, with higher market share in other countries failing to offset the lost demand from China.
  • Soybean prices slid after the report, with July-dated contracts tumbling to as low as $8.26/bushel at the Chicago Board of Trade, the lowest since December 2008.
  • The agency projects a much different outlook for the corn market, forecasting a larger than expected 1.55-bushel drop in U.S. corn stockpiles in 2018-19, nearly 25% lower than a year earlier, and higher exports of the U.S. crop; July corn futures rose 1.6% to $3.365/bushel after the report.
  • ETFs: DBA, CORN, WEAT, SGG, SOYB, JJG, RJA, BALB, COW, CANE, DAG, JJA, GRU, AGA, SGAR, WEET, CTNN, FUD, UAG, USAG, AGF, TAGS, UBC, ADZ, JJS, DIRT, LSTK, GRWN

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