RPT-PREVIEW-USDA may trim US soy export outlook in key crop reports, analysts say

By Julie Ingwersen

CHICAGO, Jan 9 (Reuters) - Grain analysts expect the U.S. Department of Agriculture may trim what some believe were overly optimistic estimates for soybean export demand in the current crop year, especially given lower sales to China, when it releases closely watched crop reports on Monday.

They also expect lower estimates for U.S. corn and soybean harvests, in part reflecting dry autumn weather, although global supplies are expected to remain plentiful with large South American harvests imminent.

The monthly report's view of demand for U.S. grains will get particular scrutiny as farmers grapple with low prices and a hit to exports - especially for soybeans - from global tariff wars, which compelled the Trump administration to announce a $12 billion aid program for growers.

"The day of reckoning is coming for USDA to have to reflect lower soybean exports," said Randy Mittelstaedt, an analyst with brokerage R.J. O'Brien, a StoneX company.

The USDA will release several major reports in its biggest data dump of the year on Monday at 11 a.m. CST (1700 GMT), including a monthly world supply/demand report, a U.S. crop production report, a quarterly rundown of U.S. grain stockpiles and a winter wheat seedings report.

SOYBEAN EXPORTS HIT BY CHINA TENSIONS, BRAZIL COMPETITION

While export sales of U.S. corn for the current season are projected at a record high, soybean exports are projected to fall amid trade tensions with top global buyer China and competition from Brazil, where farmers are starting to harvest their largest-ever soy crop.

Market players will be keen to see how, or whether, the USDA adjusts its U.S. soybean export forecast, given the slow pace of sales to China. Beijing shunned American supplies for months before resuming purchases in late October.

In its last monthly supply/demand report in December, the agency left its estimate of U.S. soybean exports for the September 2025-August 2026 season unchanged, projecting a 13% year-over-year drop. But net soybean sales as of January 1 were down nearly 29% from the same point a year earlier, according to USDA data, leaving analysts skeptical of the USDA's forecast.

China has purchased around 10 million metric tons of U.S. soybeans so far in the 2025/26 season, less than half the typical volume in recent years of about 25 million to 30 million tons. Meanwhile, Brazilian farmers will soon begin harvesting a monster soybean crop that should dominate global exports.

"We think our (U.S. soybean) export window, basically, as we get closer to February, completely closes," said Don Roose, president of Iowa-based U.S. Commodities.

The Trump administration said in October that Beijing had committed to buying 25 million tons of U.S. soybeans annually for the next three years, but China has not officially confirmed the deal.

Analyst expectations for end-of-season U.S. soybean stocks in Monday's reports ranged widely from 245 million to 350 million bushels, a huge variance that underscores uncertainty about demand for the oilseed.

U.S. CORN CROP SEEN SMALLER, BUT STILL A RECORD

Maintaining brisk demand will be crucial for the U.S. corn market following the harvest of a bumper 2025 crop. Analysts surveyed by Reuters on average expect the USDA to lower its U.S. corn yield estimate to 184.0 bushels per acre, down from the government's current figure of 186.0 but still a record high.

Analysts expect U.S. production to top 16.5 billion bushels - below the USDA's current estimate of 16.752 billion but easily surpassing the previous record of 15.3 billion bushels in 2023.

As with soybeans, the range of estimates for U.S. corn ending stocks was wide: from 1.772 billion bushels to 2.235 billion bushels, with some analysts expecting the government to cut its forecast of 2025/26 corn used for animal feed. The U.S. cattle herd has shrunk to its smallest in decades following a multi-year drought that dried up pastures.

The USDA's quarterly stocks report, including a survey-based count of grain stored on and off farms as of December 1, will influence the government's forecast of how much grain will remain at the end of the 2025/26 marketing year on August 31.

The average analyst estimate for quarterly December 1 corn stocks was 12.962 billion bushels, up 7.3% from a year ago and potentially the largest December 1 corn stocks figure in USDA records dating to 1926.