Record soy crops expected in the US due to sustainability intensification
04 Jul 2022 --- With all eyes on soybean stocks amid market volatility exacerbated by inflation and the Russian war with Ukraine, the US Soybean Export Council (USSEC) analysts have claimed record crops can be expected, bringing much-needed relief to livestock farmers.
“As global supplies of soy are tight, the world is watching US soy production. Now is the time to look carefully and critically at the global environment, what your customers expect and what you expect,” says Jim Sutter, CEO, USSEC.
“Russia’s war on Ukraine, the aftermath of COVID-19, spiking inflation, and supply chain disruptions all remind us of our shared responsibility to work together.”
Exceeding market expectations
The market expected a decrease in planted acres across the US due to a wet planting season. At the same time, the US Department of Agriculture (USDA) slashed soybean acres by 2.7 million acres.
Despite these circumstances, farmers are still expected to produce a record soy crop, weather permitting.
Even though USDA slashed soybean acres from 91 million acres (36.8 million hectares) in its March report to 88.3 million acres (35.7 million hectares), it’s still the highest soybean area planted since 2018.
Many US states have seen increases in planted soybean acres.
“If we assume a trend yield of 51.5 bushels per acre (3.46 metric tons (MT) per hectare), the reduction in planted area implies a drop in production of about 130 million bushels (3.5 million metric tons(MMT)),” says Mac Marshall, VP, market intelligence, USSEC and the United Soybean Board.
The crop size would still be a record at 4.5 billion bushels (122.5 MMT). USSEC posits that the numbers reflect an adoption of innovation and sustainable intensification.
Since 1982, US forestland has increased by 5.2 million acres (2.1 million hectares), while cropland has decreased by about 49.4 million acres (20 million hectares). Additionally, US soybean farmers have improved their greenhouse gas emissions, reducing it by 43% per bushel while increasing production by 130% since 1980.
“Carbon footprint matters in many markets. US soy has the lowest carbon footprint compared with soy from other major origins, according to Blonk Consultants and the Global Feed LCA Institute,” says Sutter.
All eyes on US soy
According to the USDA’s latest Grain Stocks and Planted Acreage report, soy acres are estimated at 88.3 million acres (35.7 million hectares) and showed record export demand from March through May.
Many states saw increases in planted soybean acres; however, North Dakota saw the biggest change, with the March figure revised by 1.1 million acres (0.4 million hectares), bringing it to 5.9 million acres (2.4 million hectares).
USDA analysts estimated June inventories at 971 million bushels (26.4 MMT). Marshall said this was within trade expectations and a 26% increase from March 2021.
The USDA reports that the carryout reflects 205-million-bushels (5.6 MMT) at present, which is small based on historical figures and the reason for the high prices. Farmers and traders will be on edge throughout the growing season as it will be a weather market until November.
Edited by Inga de Jong
