Soybeans at $4 Per Bushel or Less

May 15, 2001

Record U.S. soybean production combined with strong competition from South America is expected to lead to record ending stocks in the United States in marketing year 2001-02. U.S. soybean production in 2001 is forecast at 81.2 million tons, 3.8 million tons higher than last year and helping to force farm prices to the $4 mark or lower.

Despite the increased production levels and steady growth in domestic crushing, U.S. exports are projected at 26.7 million tons, slightly below the 2000-01 marketing year's estimate of 26.9 million tons. Increased competition in the upcoming October-December period from remaining record South America supplies is expected to keep U.S. exports from expanding.

Without increased exports to remove excess supply, U.S. ending stocks are forecast to reach 13.6 million tons, a 69.7% increase from 2000-01 estimated ending stocks of 8 million tons. The abundant supply is expected to lead the marketing year average soybean price in 2001/02 to range between $3.90 and $4.50 per bushel.

U.S. soybean product exports are seen mixed in 2001-02. Soybean meal exports are expected to decline 136,000 tons to 6.1 million tons, while soybean oil exports are expected to increase 21% to 771,000 tons.