Introduction: At the beginning of January, under the pressure of favorable rainfall and bumper yield expectations in South America, the CBOT soybean futures price continued to **, and as of January 6, the main 01 contract fell below 1250 cents, and finally closed at 124575 cents, the lowest level in more than two years during the session. ** Falling endlessly, how will the market perform in the absence of bullish drive? On this occasion, the U.S. Department of Agriculture (USDA) will bring two blockbuster reports to the agricultural product market in the early morning of January 13, Beijing time, which is also the first monthly supply and demand report of agricultural products in 2024. Where will the domestic soybean meal market go? Next, follow the details**!
1. Forward-looking analysis of the January report
On average, analysts expect the U.S. Department of Agriculture's (USDA) January supply and demand report to show global 2023-24 soybean ending stocks of 1115.8 billion tonnes with an estimated range of 1072-1.1.4 billion tonnes, USDA's December monthly report is estimated at 1142.1 billion tons; U.S. soybean ending stocks were 24.3 billion bushels with an estimated range of 215-3.1.4 billion bushels, USDA's December monthly report is expected to be 24.5 billion bushels; Brazil's soybean production in 2023 24 was 1562.6 billion tonnes, with an estimated range of 151-1.6.1 billion tonnes, USDA estimated 16.1 billion tons; Argentina's 2023-24 soybean output is 48.87 million mt, with estimates ranging from 48 million to 51 million mt, compared to 48 million mt in USDA's December monthly report.
We expect that in the December 2023 supply and demand report, while the U.S. soybean yield and output remain unchanged, there may not be much change in January under the condition of determining the production of U.S. soybeans, and the ** end will still maintain a tight pattern. This report will still focus on the demand side of U.S. beans. U.S. soybean exports are currently sluggish, with total U.S. soybean export sales progress at 76 percent in the week ended Dec. 2852%, behind 7745%。In addition, according to USDA data, the total U.S. soybean export inspection in the week ended January 4, 2024, was 23,945,566 tons, compared with 30,239,371 tons in the same period last year, a year-on-year decrease of 2081%。The Brazilian soybean harvest has already begun, and in the coming months, as South American soybeans are harvested, U.S. soybean exports will face stiff competition from South America. With sales lagging behind the same period last year and a sharp decline in export inspections, it may be difficult for U.S. soybean exports to meet their previous export estimates for December, so the USDA is likely to lower its U.S. soybean export target in its January supply and demand report.
In addition, in terms of crushing, the current demand for biofuels in the United States is strong, and the soybean crush capacity in the United States has expanded, according to the monthly oilseed processing data released by the United States Department of Agriculture, the U.S. soybean crush exceeded the 200 million bushels mark for the second consecutive month in November. Therefore, judging from the current strong domestic demand, it is expected that the crushing of US beans in January may be expected to be raised. In the case of crushing upward adjustment and export downward adjustment, U.S. beans will still maintain tight ending stocks, which may slightly boost the future price of U.S. beans.
In South America, the focus of this report is on the downward revision of Brazilian soybean production, which has been adjusted to 15072-1.52.8 billion tons, the market is expected to be 151-1.6.1 billion tons; According to the USDA's adjustment over the years, the downward adjustment space is above the market expectations of the major producing countries, so Brazil's soybean production in January may be in JanuaryMore than 5.1 billion, the output or will be in 153-1.About 5.8 billion tons. Argentina's soybean production is likely to have not adjusted much. Therefore, in general, South American soybean production may face a downward revision, coupled with the expectation that the ending stocks of US soybeans will continue to tighten, and the global soybean ending period will also face a downward revision.
2. USDA reported production and inventory adjustment trends in January over the past 10 years and its impact on CBOT soybeans**
By observing the data of the past 10 years, we can find that on the day of the release of the USDA's January supply and demand report, the CBOT soybean futures price has risen more and fallen less in the past 10 years, of which there are 8 years** and only 1 year**, with a probability of up to 80%. In the week following the report (including the day the report was published), CBOT soybean futures prices have been in the past 10 years**, 6 years**, with a probability of only 30%. In other words, judging from the pattern of previous years, after USDA's January supply and demand report, CME Group's CBOT soybean futures price rose more and fell less.
3. Prediction of the market outlook
Judging from the current forward-looking data, the probability of USDA downward revision of global soybean ** is highU.S. soybean ending stocks may continue to decline. Therefore, judging from this month's data alone, the data may be slightly bullish. However, looking at the overall situation, it is a foregone conclusion that the global soybean** will gradually ease in 2023 24. Therefore, the upside is still limited, and it is expected that the market may run in the 1230-1270 cents** after the report is released. Later, under the influence of favorable weather in Brazil and soybean harvest and marketing, the center of gravity continued to move downward, and the focus on whether 1200 cents could stand firm before the Spring Festival. The overall trend of continuous meal follows the United States beans, at presentIn the case of weak domestic supply and demand, soybean meal is under heavy pressure, and it is expected that the basis will still have room to shrink. In the later stage, we will pay attention to the rhythm of Spring Festival stocking after mid-to-late January.