NAPERVILLE, Ill., Sept 15 (Reuters) - U.S. soybean exporters have a respectable sales record to start the new marketing year, but the shrinking U.S. crop, questionable Chinese demand and South American competition are all threats for future bookings.

The same factors pressure U.S. corn exports, though the latest sales levels are already lackluster ahead of the U.S. harvest.

Technical issues have prevented the U.S. Department of Agriculture from publishing weekly U.S. export data for nearly a month, but data resumed on Thursday featuring four weeks of sales ended Sept. 8. The data drought spanned marketing years as 2022-23 began on Sept. 1 for corn and soybeans.

Soybean sales for 2022-23 in those four weeks beat market expectations at 5.75 million tonnes, and 83% was to either China or unknown destinations. Estimates ranged from 2.5 million to 5.3 million.

Total 2022-23 soybean sales stood at 25.3 million tonnes as of Sept. 8, second-best for the date after 2020 and driven partly by significant Chinese buying back in January and February.

The Sept. 8 total covers an above-average 45% of USDA’s full-year export forecast of 2.085 billion bushels, reduced from 2.155 billion earlier this week as U.S. harvest prospects plunged.

A year ago, soybean sales covered 39% of USDA’s September export projection, and 2021-22 exports are currently estimated 3% above that year-ago forecast, largely on Brazil’s crop shortfall.

Brazilian farmers began planting their potential record soybean crop on Thursday, though those supplies will not directly compete with U.S. ones for a few months. But Argentine beans are unexpectedly cramping U.S. business this month after the government incentivized soy sales through a favorable exchange rate.

Argentina is the top exporter of soybean products and a smaller supplier of raw beans. But China, its top bean buyer, may have secured upward of 1.5 million tonnes (55 million bushels) so far this month for shipment this month or next.

That would cover just 1% of China’s expected 2022-23 soybean use, but it represents a notable portion of potential U.S. exports. September and October U.S. shipments to China will exceed 8 million tonnes in normal years.

Chinese soy import estimates for 2022-23 have been easing in recent months as lockdowns have limited demand recovery. This plus China’s opportunistic Argentina bookings and a monster crop looming in Brazil may mean U.S. soy supplies tighten to a less-than-expected degree despite crop losses.

USDA has not announced any daily export sales of U.S. soybeans or corn in the latest week.

For the 2022-23 marketing year, U.S. corn sales in the four weeks ended Sept. 8 reached 2.465 million tonnes, within the range of estimates from 1.7 million to 3.4 million.

That brings total 2022-23 corn sales to 12.3 million tonnes, some 21% of USDA’s 2.275 billion-bushel outlook, the third-lowest coverage rate by the same date since at least 2007.

U.S. corn sales were standout at this point in the last two years, so this year is weak by comparison. Total corn commitments are down 50% on the year and down 38% from two years ago, but those margins shrink to 29% and 18% when removing China from the mix.

China was a big driver of early U.S. corn sales in the last two years, but they are weaker now. Chinese purchases as of Sept. 8 totaled 3.36 million tonnes, down 72% from a year ago and off 63% from the same date in 2020.

Both USDA and China’s agriculture ministry peg 2022-23 Chinese corn imports at 18 million tonnes, but USDA’s peg is down from an estimated 23 million in the prior year versus China’s 2021-22 figure of 20 million.

Non-China U.S. corn sales are historically sluggish at 8.9 million tonnes, the second-lowest by Sept. 8 in at least the last 12 years, ahead of just 2019.

It can be hard to spur U.S. corn bookings at this time of year following a bumper Brazilian harvest, and the South American exporter just shipped an all-time monthly record of the yellow grain in August.

China earlier this year green-lighted Brazilian corn imports, adding pressure to U.S. possibilities. However, Brazil’s agriculture ministry last week said there are still bureaucratic procedures to clear before that trade can begin.

U.S. grain exports narrowly avoided disaster on Thursday as the government reached a tentative deal with railway labor unions, averting the anticipated Friday shutdown. read more U.S. railroads, vital to grain exports, planned to start halting grain shipments on Thursday in preparation. read more

Karen Braun is a market analyst for Reuters. Views expressed above are her own.

Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

Source: Reuters

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