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Thailand (Bualuang): Agro&Food - Soybean: USDA’s May report

  • USDA’s May report—tight US stocks outlook in 2021/22 …

  • … and a modest rise in 2021/22 Brazil and Argentina’s stocks

  • Short-term global SB price retreat in second half of May

Bualuang Securities
24 May 2021

The USDA’s May report pointed to the very tight 2021/22 US and global stocks. Despite higher 2021/22 US output, its higher domestic crush at a record high from expanding demand for biofuels led to a small rise in the US stocks. Brazil and Argentina’s 2021/22 stocks will also rise modestly YoY driven by their higher crush and Brazil’s export jump. If there is some supply damage from the weather in the US and Argentina, we believe that there are downside risks to their 2021/22 output. Our TRADING BUY stands on TVO, based on robust 2021 earnings and a high dividend yield.

USDA’s May report—tight US stocks outlook in 2021/22 …

In its May 12 World Agricultural Supply and Demand Estimates report, USDA released the 2021/22 forecasts for the first time and projected the 2021/22 US planted areas at 87.6m acres (or up 5.4% YoY), US harvested areas of 86.7m acres (or up 5.3% YoY) and its production at 4.41bn bushels (up 6.5% YoY). We regard the YoY rise in 2021/22 US planted and harvested areas as surprisingly marginal.