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Economist: Corn & Soybean Export Sales Lag Last Year
USAgNet - 10/09/2019

Export sales this year started slowly, particularly for corn. Recent sales to China buoyed soybean export sales in September. Abundant crops around the world, competitive pricing, and trade issues slowed export sales early this marketing year, according to University of Illinois agricultural economist Todd Hubbs.

At 2.050 billion bushels, the current USDA projection for corn exports during the 2019-20 marketing year sits slightly lower than the last marketing-year's export totals. On Oct. 4, the Census Bureau released export data for August. Corn exports for the 2018-19 marketing year totaled 2.067 billion bushels; down 372 million bushels from the 2017-18 marketing year despite the torrid start for sales and exports at this time last year, Hubbs says.

"Although outpacing the previous marketing year's export pace by 334 million bushels through the first half of the 2018-19 marketing year, the second half saw exports come in 707 million bushels below the pace in 2017-18. Abundant South American crops and competitive pricing saw the U.S. export share of the world market fall precipitously," he adds.

The weak pace of corn exports continues in the 2019-20 marketing year. Through the first 26 days of the marketing year, the USDA reported corn exports at 63 million bushels, down from 180 million bushels last year over the same period. Outstanding sales totaled 319 million bushels on Sept. 26, compared with 596 million bushels last year. Sales of corn sit lower to all regions of the world, but buying from Asia is particularly slow. Sales of corn to Japan sit at 33 million bushels, down from 79 million bushels a year ago.

Outstanding sales to all of Asia total 42 million bushels, well below the 162 million bushels recorded last year. Mexico sits slightly below the previous year's totals in both sales and exports with total commitments coming in at 210 million bushels, 30 million bushels below last year. Total commitments sit at 19% of the projected export total for the 2019-20 marketing year, down from the five-year average of 30%.

"Uncertainty about the size of the 2019 U.S. corn crop continues," Hubbs says "A sizeable reduction in corn production this year will influence export totals. South American production looks to have a say in the U.S. export market share as well."

Forecasts of corn production in Argentina and Brazil during the 2019-20 marketing year currently sit at 5.94 billion bushels, slightly below last year. The forecasts for corn exports are lower. Projections of Brazilian exports fell by 157 million bushels to 1.34 billion bushels. At 1.32 billion bushels, the projection for Argentinian exports sits 98 million bushels lower than the last marketing year's estimate. A continuation of dry weather in the region holds the potential for full-season corn production to move lower.

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