Because of the wide range we’ve seen over the last few months, I’m posting a different look at similar analysis for soybean monthly stocks-to-use. For this study, the 2020-2021 marketing year average daily price of the cmdty National Soybean Price Index (NSPI, weighted national average cash price) is $9.71 (solid green marker on trendline). This price correlates to an ending stocks-to-use calculation of 2%, the lowest we would have seen dating back through the 2014-2015 marketing year. In its October Supply and Demand report, USDA’s estimates resulted in an ending stocks-to-use calculation of 6.4% (green spotted marker).
I have some doubts about using this form of analysis for soybeans. Note the 2018-2019 marketing year, my analysis showed ending stocks-to-use to be 74% (gold marker), as compared to USDA’s final numbers resulting in 22.9%. Last marketing year, 2019-2020 (red markers), my analysis showed ending stocks-to-use of 32.4% versus USDA’s final 13.2%. The 2017-2018 marketing year (blue markers) were the last time the two were close with my analysis coming in at 9% and USDA finishing with 10.2%.
There is still 10 months remaining in the 2020-2021 marketing year, meaning a lot of time for the daily average price to change. For now, though, this analysis seems to agree with the strong inverse seen in the soybean futures forward curve.