By Justin Walker
Communications Specialist
Despite a potential record year for soybeans in 2018, growers could still face challenges from ongoing trade negotiations, according to U.S. Department of Agriculture (USDA) experts.
The recent soybean forecast dropped two percent from October projections, but a record 4.6 billion-bushel crop is still predicted.
A combination of smaller-than-expected supplies and no real change in negotiations with China have impacted exports, USDA Outlook Board Chairman Seth Meyer said.
“We did feel like we needed to make some adjustments on the export side, in terms of lowering exports,” he said in an interview.
China is the typical purchaser of U.S. soybeans during the first four months of the marketing year—September to December, but the country has made it clear they will try to not do business with the U.S., Meyer said.
“So far they have managed to mostly avoid us,” he said. “They will draw down stocks early in the year, and then replenish it when the South American crop comes off.”
That should take place toward the end of December, Meyer said. Once that occurs, the U.S. may begin to gain access to markets South America can’t supply.
With export totals expected to be down this year, Meyer believes U.S. stocks will increase. Crop prices could average $8.60 per bushel, a 73-cent decrease from this season, he said.
The 2018 crop is telling of the overall growth for soybeans in the United States.
Steady increase in soybean production is evident by yearly totals from the last four years, Warren Preston, USDA deputy chief economist, said.
In 2015, U.S. soybean totals hit 3.93 billion bushels and increased to 4.3 billion in 2016, 4.41 billion in 2017 and an expected 4.6 billion this year.