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USDA Update – Soybean and Cotton
Friday, November 11, 2016
www.angelcommodities.com
USDA increases global production for Soybean and
Cotton
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Prepared and Compiled by Ritesh Kumar Sahu Analyst - Agri Commodities [email protected] (022) 2921 2000 Extn. 6165
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USDA Update – Soybean and Cotton
Friday, November 11, 2016
www.angelcommodities.com
Soybean
World Production to rise
Global soybean production is forecast higher this month by
United States Department of Agriculture (USDA) at 336.1
million tonnes (mt) in November Vs. 333.2 mt in October.
USDA raised world production for the new crop by 2.51 mt
due to forecast of increase in US production due to higher
yield estimates and unchanged production estimates for
Brazil, Argentina, China and India. USDA forecast the yields
averaged a record-high of 52.5 bushels per acre for
2016/17 season.
The top five soybean producing countries are the US,
Brazil, Argentina, China and India, which is going to
produce higher compared to last year production. The US
will produce 11% higher in 2016/17 at 118 mt compared to
last year.
The production in Brazil is estimated at 102 mt for 2016/17
season, higher by 5.7% compared to last year production
269
282
320 313
333 336
260 270 280 290 300 310 320 330 340
2016/17 2016/17
2012/13 2013/14 2014/15 2015/16 Oct Nov
Tho
usa
nd
s
World Production of Soybean (mt)
Source: USDA
119 102
57
13 10 9 6 21
0
20
40
60
80
100
120
140
Un
ited
St
ates
Bra
zil
Arg
enti
na
Ch
ina
Ind
ia
Par
agu
ay
Can
ada
Oth
er
Tho
usa
nd
s
Top Soybean producing Countries (mt)
Source: USDA
of 96.5 mt. The production in Argentina forecasted slightly
higher at 57 mt while production in China and India is
forecasted to increase by 6% and 36% respectively.
World ending stocks at record levels
World ending stocks for soybean increase by 5.39% or
4.17 mt to 81.53 mt in November for 2016/17 season
versus 77.4 mt estimated in October. This upward
revision is due to increase in stocks in US and China. It is
the sixth consecutive yearly increase in world ending
stocks starting 2011/12. According to the latest USDA
report, Argentina and Brazil will be holding close to 70% of
soybean at the end of 2016/17 season. A bigger soybean
carryover stocks is seen for Argentina because of lower
exports in 2015/16 (down 670,000 tonnes to 9.25 mt) and
increase in production (up 200,000 tonnes to 57 mt).
US soybean ending stocks increase the most by 21.75% or
2.34 mt to 13 mt, from the October estimates in
November report, while the yearly stocks increase by
143.8% or 7.7 mt compared to 2015/16 stocks. US will
hold about 16% stocks in 2016/17.
World trade to Increase
World exports of soybeans, is expected to grow 5.31 % in
2016/17 to 139.2 mt, is due to higher U.S., China and
Brazil supplies and increase in imports from China, Mexico
and Indonesia.
China, European Union and Mexico are the top three
soybean importing countries in the world. China will
import about 86 mt of soybean in 2016/17, an increase of
3.3% or 2.8 mt than the previous year imports. Moreover,
55
62
79 77 77 82
50 55 60 65 70 75 80 85
2016/17 2016/17
2012/13 2013/14 2014/15 2015/16 Oct Nov
Tho
usa
nd
s
World Ending Stocks (mt)
Source: USDA
USDA Update – Soybean and Cotton
Friday, November 11, 2016
www.angelcommodities.com
The soymeal exports for 2016/17 season is also
forecasted to increase by whopping 500% or 750,000
tonnes compared to last year exports. On the other hand
the soybean oil import is estimated to be lower at 40 lt in
2016/17 compared to last year. Last year, India imported
about 43.6 lt.
India Balance Sheet
100
82
68 60
76 76
50
60
70
80
90
100
110
2016/17 2016/17
2012/13 2013/14 2014/15 2015/16 Oct Nov
Hu
nd
red
s
Domestic Soybean Crush (Lakh Tonnes)
Source: USDA
1000 2015/16
Oct Nov M/M Y/Y
Beginning Stock 797 106.00 106 0.00 -86.70
Production 7,000 9,700 9,700 0.00 38.57
Imports
Total Supplies 7,797 9,806.00 9,806 0.00 25.77
Domestic Use 7,650 10,550 10,550 37.91 37.91
Exports
Total Demand 7,650 10,550.00 10,550 0.00 37.91
Ending Stocks 106 77.36 82 5.39 -23.09
Source: USDA
India Soybean Balance Sheet (million tonnes)
2016/17 %Chg
Mexico, Taiwan, Indonesia and Iran also increase their
soybean imports this year due to good crushing demand.
In the contrary, EU, the second largest soybean importer
and highest soybean meal importer, is forecasted to
import 11 % less soybean in 2016/17 to 13 mt from 14.6
mt in the previous year.
World Balance Sheet
Domestic production
The estimate of production of soybean in India is kept
unchanged by USDA in its November report at 97 lakh
tonnes (lt). However, the production during 2016/17 is
forecasted higher by 36% or 25.8 lt compared to last year
production.
USDA also kept its figures of crush for 2016/17 season
unchanged at 76 lt in its November report which it is
higher by 27.7% or 16.5 lt compared to last year crushing
figures. The increase in crushing is due to higher
production estimates due to higher yield achieved for the
soybean crop in the country.
1000 2015/16
Oct Nov M/M Y/Y
Beginning Stock 78.60 77.07 77.07 0.00 -1.94
Production 313.20 333.22 336.09 0.86 7.31
Imports 132.96 136.22 136.21 -0.01 2.45
Total Supplies 524.76 546.51 549.37 0.52 4.69
Domestic Use 276.18 288.49 288.17 4.34 4.34
Exports 132.14 138.78 139.16 5.31 5.31
Total Demand 408.32 408.32 427.33 4.66 4.66
Ending Stocks 77.07 77.36 81.53 5.39 5.78
Source: USDA
Soybean World Balance Sheet (million tonnes)
2016/17 %Chg
122
95 87
71
97 97
60 70 80 90
100 110 120 130
2016/17 2016/17
2012/13 2013/14 2014/15 2015/16 Oct Nov
Hu
nd
red
s
Domestic Production of Soybean (Lakh Tonnes)
Source: USDA
USDA Update – Soybean and Cotton
Friday, November 11, 2016
www.angelcommodities.com
Cotton
Production forecast higher
For, 2016/17, world cotton production and ending stock
forecasted higher this month due to forecast of higher
production in India and the US. The global trade is also
increased while consumption figures were fairly unchanged in
the November report.
India is going to be largest producer of cotton in the world for
the second successive year ahead of China, the US and
Pakistan. In latest report, USDA revised the production for
India by 1.89% or 109,000 tonnes or 6.41 lakh bales (1
bale=170kg). The US production also revised upwards by
0.80% or 28,000 tonnes in November compared to its forecast
in October.
On year-on-year basis, the volume of production is estimated
to increase the most in the US, Australia, Pakistan and India
during 2016/17.
26.98 26.21 25.95
21.01
22.36 22.49
20 21 22 23 24 25 26 27 28
2016/17 2016/17
2012/13 2013/14 2014/15 2015/16 Oct Nov
Tho
usa
nd
s
World Cotton Production (mt)
Source: USDA
5.88
4.57
3.52
1.80 1.42
0.87 0.81
3.63
0
1
2
3
4
5
6
7
Ind
ia
Ch
ina
Un
ited
St
ates
Pak
ista
n
Bra
zil
Au
stra
lia
Uzb
ekis
tan
Oth
er
Tho
usa
nd
s
Top Cotton Producing Countries (mt)
Source: USDA
World Consumption data steady
In 2016/17, the world consumption will increase by 0.65%
on year but was unchanged in the latest November
report. The consumption will be higher in the countries
like Vietnam, Bangladesh, Turkey, the US and China
compared to previous year due to good demand from the
textile industries.
World Trade to Improve
The world trade- Export and Import- is higher in
November report due to possible increase in imports and
exports in India. India cotton exports for 2016/17 was
forecasted up by 7.7% or 65,000 tonnes this month to
914,000 tonnes while imports are up by 19.9% to 392,000
tonnes.
The exports for the US and Australia is forecasted to
increased by more than 30% in 2016/17 compared to
previous year while the import volume will higher for the
23,612
23,902
24,194 24,227
24,391 24,384
23,500
23,700
23,900
24,100
24,300
24,500
2016/17 2016/17
2012/13 2013/14 2014/15 2015/16 Oct Nov
World Cotton Consumption ('000 tonnes)
Source: USDA Source: USDA
0
500
1,000
1,500
2,000
2,500
3,000
Un
ited
St
ates
Ind
ia
Au
stra
lia
Bra
zil
Uzb
ekis
tan
Bu
rkin
a
Mal
i
Cotton Exports 2016/17 Vs 2015/16 ('000 tonnes) 2015/16 2016/17
Source: USDA
USDA Update – Soybean and Cotton
Friday, November 11, 2016
www.angelcommodities.com
countries like Bangladesh and Vietnam. The China import
will also improve in 2016/17 due to lower production and
high consumption.
World Ending Stocks improve
In the November report the world ending stocks have
improved due to increase stocks predicted in the US and
India. The stock position in the US will increase 4.7% or
44,000 tonnes in November while stocks in India are
forecasted to increase by 4.5% or 108,000 tonnes.
World Balance Sheet
20,058
22,494
24,302
21,099
19,018 19,226
19,000
20,000
21,000
22,000
23,000
24,000
25,000
2016/17 2016/17
2012/13 2013/14 2014/15 2015/16 Oct Nov
World Cotton Ending Stocks (1000 MT)
Source: USDA
2015/16
Oct Nov M/M Y/Y
Beginning Stock 24.30 21.10 21.10 0 -13.18
Production 21.01 22.36 22.49 0.57 7.02
Imports 7.68 7.60 7.67 0.84 -0.21
Total Supplies 53.00 51.06 51.25 0.37 -3.29
Domestic Use 24.23 24.39 24.38 -0.03 0.65
Exports 1.80 1.64 1.66 1.10 -7.85
Total Demand 26.02 26.03 26.04 0.04 0.06
Ending Stocks 21.10 19.02 19.23 1.09 -8.88
Source: USDA
2016/17 %Chg
Cotton World Balance Sheet (Million tonnes)
Domestic production to rise
The USDA has marginally raised its forecast for India's
cotton output for 2016-17 to 345.8 lakh bales (1 bale = 170
kg) or 5.88 mt from 339.41 lb (5.78 mt) projected in
October.
An increase of 6.41 lakh bales (108,800 mt) in November
report is due to anticipated higher yields in the cotton
growing states of Punjab, Haryana and Rajasthan in
Northern India. While late season rains falls in western
states of Gujarat and Maharashtra have helped in increase
in cotton yield in these two top producing states.
Moreover, trade sources indicate that farmers have seen a
recovery from last year’s pest infestation due to vigilant
crop monitoring, overall better plant protection measures,
and improved soil moisture and weather conditions.
It also raised the forecast for cotton exports from the
country to 53.76 lakh bales from 49.9 lakh bales projected
earlier which is in line with the output estimate.
India Balance Sheet
5,100
5,400
5,700
6,000
6,300
6,600
6,900
2016/17 2016/17
2012/13 2013/14 2014/15 2015/16 Oct Nov
India Cotton Production ('000 tonnes)
Source: USDA
2015/16
Oct Nov M/M Y/Y
Beginning Stock 17.27 14.02 14.02 0 -18.84
Production 33.81 33.94 34.58 1.89 2.28
Imports 1.37 1.92 2.31 19.88 68.24
Total Supplies 35.18 35.86 36.89 2.85 4.85
Domestic Use 31.06 30.74 30.74 0.00 -1.04
Exports 7.38 4.99 5.38 7.66 -27.17
Total Demand 38.44 35.73 36.11 1.07 -6.06
Ending Stocks 14.02 14.15 14.78 4.49 5.46
Source: USDA
India Cotton Balance Sheet (Million Bales (170 kg))
2016/17 %Chg
