USDA lowered its forecast for global oilseed production, including sunflower in the Black Sea region and soybeans in the US, leading to an increase in quotes

In the August world oilseed balance for the 2025/26 MY, FAS USDA experts lowered the forecast for world oilseed production compared to July estimates by 3.3 million tons to 690.11 million tons, which will still be 1.2% higher than the previous season's figure of 681.76 million tons (in the 2023/24 MY - 658.08 million tons).

The forecast for world soybean production was reduced by 1.29 million tons to 426.39 (424) million tons due to a decrease in the estimate for the USA (although analysts expected an increase in the harvest), sunflower - by 1.2 million tons to 55.1 (52.5) million tons due to a reduction in production in Ukraine, the EU, Turkey and Serbia, cotton - by 0.81 million tons to 40.44 (41.05) million tons, while the forecast for rapeseed harvest was left at 89.58 (85.65) million tons.

According to the USDA forecast, global oilseed processing in 2025/26 MY will decrease by 1.28 million tons to 580.5 (563.4) million tons due to a reduction in sunflower processing.

The forecast for world ending stocks of oilseeds has been reduced by 0.81 million tons to 144.36 (144.11) million tons due to a decrease in soybean stocks by 1.1 million tons to 124.9 (125.2) million tons.

The main adjustments to the soybean balance were due to a reduction in the US harvest forecast by 1.1 million tons to 116.82 (118.8) million tons due to an unexpected decrease in sowing areas by 2.5 million acres to 80.9 (87.1) million acres, which does not compensate even for the increase in the yield estimate from 52.5 to 53.6 bushels/acre (3.6 t/ha), which exceeded analysts' expectations.

The forecast for soybean exports from the US has been reduced from 47.5 million tons to 46.4 (51) million tons, as China has not yet signed agreements with the US and is not buying American soybeans, but is increasing purchases from Brazil and Argentina.

November soybean futures in Chicago rose 2.1% yesterday to $379.5/t (+2.6% after the release of the July report).

It is also worth noting that the forecast for soybean production in Ukraine was left at a record level of 7.6 million tons (7 million tons last season), although local analysts are lowering their forecasts to 5.8-6.5 million tons due to adverse weather.

The forecast for sunflower production in Ukraine has been reduced by 0.5 million tons to 13.5 (13) million tons, in the EU by 0.5 million tons to 9.5 (8.5) million tons, in Turkey by 0.15 million tons to 1.6 (1.35) million tons due to dry conditions. At the same time, the forecast for the Russian Federation was left unchanged at 18 (16.9) million tons, while local analysts raised their estimates to 19-20 million tons, although drought is currently reducing the harvest potential in the south. Sunflower prices in Ukraine are supported by low end-of-season stocks and a reduced harvest forecast for the new season.

In their August report, USDA experts did not change their forecasts for the world rapeseed harvest in 2025/26 MY, which will be 3.9 million tons higher than last year, but reduced the production forecast in Ukraine by 0.2 million tons to 3.5 million tons (which significantly exceeds our forecast of 2.8 million tons), and unexpectedly increased the production forecast in the EU by 0.2 million tons to 19.65 million tons (+2.8 million tons compared to the previous season), although prolonged rainfall reduced the harvest potential. The forecast for canola production in Canada was left at last year's level of 19.25 million tons.

Yesterday, China imposed temporary tariffs of 75.8% on Canadian canola, continuing to pressure the Canadian government in a “trade war,” which led to a sharp drop in quotes.

November canola futures fell 4.6% yesterday to CAD 650/t or $ 472/t (-4.6% for the month), and rapeseed quotes on the Paris exchange followed suit, falling 1.5% to € 466.5/t or $ 545/t (-2.4% for the month).

Currently, the US and China are increasing political pressure on Canada, but it is actively increasing its own rapeseed processing, so in the new season we expect a decrease in canola exports from Canada in anticipation of a resolution of trade disputes, and we do not yet predict a decrease in canola and rapeseed prices.