Despite a slight decrease in the oil production forecast, stock market quotations fell sharply

In the July balance sheet, USDA experts lowered forecasts for global production and stocks of oilseeds in FY 2022/23, in particular soybeans in the United States, as well as estimates of imports and consumption of soybeans in China, which led to a sharp drop in prices for oilseeds and their processing products.

In comparison with the June report , the oil balance for 2022/23 MR underwent the following changes:

• The forecast for world production of oilseeds was reduced by 3.75 million tons to 643.07 million tons, which will still be 7.2% higher than the 600.33 million tons collected in FY 2021/22. The decrease in soybean production by 3.97 million tons to 391.4 million tons partially offsets the increase in sunflower production by 1.16 million tons to 50.38 million tons.
• The estimate of world oilseed ending stocks was reduced by 1.44 million t to 118.51 million t (107.63 million t in FY2021/22), including soybean stocks in the US and China and sunflower in Ukraine, although soybean stocks in Argentina will grow.
• The forecast of global rapeseed production was reduced by 0.57 million tons to 80.23 million tons (72.1 million tons in 2021/22 FY), in particular for the EU - by 0.4 million tons to 17.85 (17.265) million tons.
• The estimate of world sunflower production was increased by 1.16 million tons to 50.38 million tons (57.38 million tons in 2021/22 MR), in particular for Russia - by 1 million tons to 15.5 million tons, as it was last year. The forecast for sunflower processing was increased by 1.4 million tons to 46.7 (46.5) million tons, in particular for the EU - from 9.9 to 10.3 (10) million tons, Russia - from 13.5 to 14.3 (14.1) million tons, Argentina - from 3.4 to 3.5 (3.4) million tons. The estimate of final reserves was reduced for Ukraine from 4 to 3.4 (4.8) million tons and Argentina - from 726 to 626 (376) thousand tons, but increased for the EU - from 0.54 to 0.8 (1.15) million tons and for Russia - from 1.13 to 1.18 (0.97) million tons.
• The forecast of global soybean production was reduced by 3.97 million tons from 395.4 to 391.4 million tons (352.7 million tons in 2021/22 MY), in particular for the USA - by 3.7 million tons from 126.3 to 122 ,6 (120.7) million tons and Canada - from 6.3 to 6 (6.2) million tons. The estimate of world soybean exports was reduced from 170.3 to 168.9 (154.1) million, primarily for the USA and Canada. The forecast of ending stocks was reduced by 0.8 million tons to 99.6 million tons (88.7 million tons in FY 2021/22), in particular for the USA - from 8.4 to 7.6 (5.6) million tons, China - from 31.5 to 30.5 (30.7) million tons, Brazil - from 30.7 to 30.3 (22.4) million tons, however, it was increased for Argentina from 23.5 to 24.9 (22, 1) million tons, Ukraine - from 800 to 950 (951) thousand tons.

In recent months, China has sharply reduced the purchase and consumption of oilseeds and vegetable oils, therefore, the forecast of soybean imports for the country for 2021/22 MR has been reduced by 2 million tons to 90 million tons, and for 2022/23 MR - by 1 million tons to 98 million tons From October to May, China imported 61 million tons of soybeans, which is 5% less than the corresponding indicator of the previous season. And for the October-July period, imports decreased by 9% or 7.5 million tons compared to last year to 76 million tons.

On the report, November soybean futures on the Chicago SWOT fell 4.7% to $493/t (having lost 13.4% for the month), but recovered to $500/t yesterday.

August canola futures on the Paris MATIF fell 4.4% to €668/t, or $670/t, after a recent 5.2% gain after the two-session report.

Export demand prices for supplies of Ukrainian sunflower to Romania and Bulgaria have fallen to $530-550/t, but the volume of supplies is decreasing, given the increase in shipping costs to $145-160/t and increased demand from domestic processors who offer for sunflower 10-12 thousand UAH/t ($340-410/t) with delivery to the factory.