U.S. soybean export sales have been substantial recently, despite a decline in U.S. soybean shipments in recent weeks, not seen since the 2018 war.
This doesn't necessarily mean that U.S. export plans are in jeopardy, as the threshold is already relatively low this year, although drought-related Panama Canal traffic delays could be a major obstacle as they could last until 2024.
Data released this week by the USDA showed that 984,410 metric tons of U.S. soybeans were inspected for export in the week ended Dec. 7, the lowest in 10 weeks and the lowest since 2018.
Export inspection data is a representation of actual shipments and is usually revised, but this data is the first of its kind provided on a weekly basis and provides insight into the activities of various U.S. export centers.
The USDA expects total U.S. soybean exports in 2023-24 to be the lowest in four years, down 12% year-on-year, so soybean inspections have been behind normal for nearly two months.
But the last two weeks have been anomalous, with soybeans accounting for about 43% of all inspected grains and oilseeds, well below the average of around 60%. With the exception of 2018, this percentage has never fallen below 50% in these weeks of the most recent year.
Delays in the Panama Canal could directly affect U.S. Gulf exports, as the passage is a key route to Asia. In addition, unusually low water levels in the Mississippi River have hindered the movement of barges toward the Gulf of America this year and last year.
However, the inspection data has not yet shown that soybean production in the Gulf region has deviated significantly from previous limits. Gulf ports accounted for 49% of all U.S. soybeans inspected in the week ended Dec. 7, the same as the same week in 2022 and 2017, but below the average of about 56%.
No idle was found at Pacific Northwest ports, which accounted for 29% of all soybeans inspected last week, unchanged from this week's average.
From a sales perspective, U.S. soybean exports** are not overstated. As of Nov. 30, 68% of the USDA's full-year target had been sold, similar to the same period in the past two years.
But it's worth noting that the number of unshipped soybeans promised in November actually rose for the first time since 2007, with monthly sales well above average, plus lower shipments.
Total soybean sales and cumulative exports as a percentage of total sales are still within the normal range, so last month's strange trend is not a cause for concern. But it can be worrying if the unshipped ledger continues to grow without a corresponding shipment effort.
U.S. grain ships are increasingly using the Suez Canal instead of the Panama Canal to get to Asia, which adds up to two weeks of lead times, increases costs and could put U.S. soybean orders at risk of cancellation, in favor of the upcoming Brazil**.