In the previous five years, total sales as of the first week of December accounted for 53 to 83 percent of total exports for the year. 

Sales to China as of Dec. 5 totaled 901 million bushels, or 63 percent of the total sales, with additional sales reported since Dec. 5. Sales to “unknown” destinations, which may include some sales to China, accounted for an additional 14 percent of the total sales.

With 38 weeks left in the 2013-14 marketing year, soybean export sales are already near the total export projection for the year. On the surface, it appears that either exports will exceed the USDA projection or that prices will have to increase to slow the pace of consumption. 

With year-ending stocks of U.S. soybeans already forecast at a near-pipeline supply of 150 million bushels, there is little room for exports to exceed the current projection. 

Exports can be measurably larger only if the 2013 U.S. crop was larger than the current forecast  (final estimate to be released on Jan. 10, 2014) or the domestic crush is smaller than forecast. 

A third alternative is that China will cancel some purchases of U.S. soybeans if the South American crop turns out to be large and prices are lower and/or the current bird flu situation there worsens and reduces the demand for soybean meal. 

Developments over the next few weeks will be critical for the direction of old-crop soybean prices. A combination of export sales cancellations, a larger U.S. crop estimate, or a larger South American crop estimate would likely trigger a lower price trend.  

Without such developments, current high prices would likely persist a while longer in order to finish the rationing of old crop supplies. Protecting the downside price risk appears prudent.