Skip to main content
You are the owner of this article.
You have permission to edit this article.
Soybean acres less than expected; China in the mix again

Soybean acres less than expected; China in the mix again


The trade was thinking there would be more soybean acres than showed up in the final planted acreage report on June 30, but it wasn’t all bad news as that and news that China was ordering new crop soybeans from the U.S. again helped push the market.

“Soybeans have been seeing actually not a bad performance. Just like we saw in corn, acres were lower than anticipated and that certainly helped to push the market,” said Randy Martinson, president of Martinson Ag Risk Management, Fargo, N.D.

“Demand for old crop soybeans has slowed down quite a bit since February. We haven’t seen a lot of sales, but we have had China come in and start to buy new crop soybeans about a week ago,” he continued. “Our new crop 2021 sales are actually ahead of last year at this time. We’re actually seeing a pretty robust demand as far as new crop is concerned. This tells us that China’s demand for the product is still there and they’re out buying pretty aggressively.”

Soybean stocks, just like for corn, Martinson pointed out, are lower than anticipated and that indicates USDA is going to have to come in to make adjustments to either the crush side or the export side.

“So we should see a little bit better ending stocks estimates for old crop,” he said.

And now, with soybean acres being lower than expected, Martinson said producers need to secure better than expected trend line yields to get the supply and demand numbers to work, and demand continues to hold as it looks like it will.

According to the USDA report released on June 30, final planted acres for soybeans in the U.S. was pegged at 87.56 million acres. That was 1.4 million acres less than expected by the trade and about 40,000 less than March intentions report.

“We needed to get more acres than what was estimated in the March estimate, but we didn’t,” he said. “But it is 4.8 million more than last year, which is the bottom end of the range that we need to get the supply and demand numbers to work with the trend line yield.”

Looking at crop condition ratings for U.S. soybeans overall, 60 percent was rated in good-to-excellent condition. Primarily the Corn Belt states are doing well, just like in corn, but again, Minnesota is only rated 45 percent good-to-excellent; North Dakota’s soybean crop is rated 25 percent good-to-excellent; and South Dakota’s crop is 26 percent good-to-excellent.

“Of the 4.8 million acres that we increased from last year, 63 percent came in North Dakota, South Dakota, and Minnesota,” he said. “It tells us that it’s unlikely that the Corn Belt is going to yield that much better to make up for what we’re losing here.”

Elsewhere in the world, South America is starting to wind down with their soybean exports and that’s why the U.S. is starting to see demand start to switch to the U.S. for the new crop side of things.

Also, Brazil is looking at increasing acres again for the 2021 calendar year. A lot of analysts are thinking Brazil could double its acreage this year.

“They’re normally looking at a 3 percent increase in acreage and it’s expected that they’re looking at a 6 percent increase in acreage this year,” Martinson said.

Looking at local prices, Martinson said, “We pushed soybeans back up to the higher end of the range, but today (July 6) they’re down about 90 cents. Right now for the cash price we’re probably looking somewhere around $12 to $12.30 cash price for off the combine, which isn’t a bad price.

“But it does look like there are some concerns about being able to get the production for soybeans and then that might come in and help this market,” he added.

At one local elevator in west central Minnesota regularly followed in this column, as of July 6, the July cash price for soybeans was $12.94 and basis was -50 cents under. The December 2021 futures price was listed at $13.09 and basis was -93 cents under.

“August is the critical crop development stage, but we’re not in that stage yet for soybeans, so all eyes will be on corn in the next couple of weeks and then it will start switching over to soybeans,” he concluded.

Farm & Ranch Guide Weekly Update

* I understand and agree that registration on or use of this site constitutes agreement to its user agreement and privacy policy.

Related to this story

Most Popular

Find the equipment you're looking for

Get up-to-the-minute news sent straight to your device.


Breaking News