OIL CROPS OUTLOOK                                           November 13, 1996
            Approved by the World Agricultural Outlook Board
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OIL CROPS OUTLOOK is issued monthly by the Economic Research Service, U.S.
Department of Agriculture, Washington, DC 20005-4788.  OCS-1196.  
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SOYBEAN YIELDS CONTINUE TO SURPRISE

By mid-November, 89 percent of the Nation's soybean harvest had been
completed, with the greatest delays still in Ohio.  Late planted soybeans,
which many observers a few months ago had considered unlikely to reach
maturity, have turned in surprisingly respectable yields.  A fortuitous
absence of freezing weather in October enabled even the latest planted fields
to mature.  Pod counts in 1996 did not increase any from previous years but
the favorable fall weather allowed for maximum bean size.  This year's
national average yield of 37.9 bushels per acre ranks behind only the 1994
record.  With a relatively large area harvested, the exceptional yield has
produced the second-largest U.S. soybean crop at 2,403 million bushels.  This
year's increased production should ease tightness, raising 1996/97 ending
stocks to 210 million bushels from 183 million in 1995/96.

Forecast yields were raised this month for Ohio, Indiana, Illinois, and
Missouri.  The Northern Plains States of Kansas, Nebraska, North and South
Dakota, which were generally planted on time, are having record soybean
output.  A low harvested soybean area in Missouri is being offset by a record
yield.

Market expectations for improved yields have suppressed soybean prices in
recent weeks.  Declining corn and wheat prices are also applying pressure on
the soybean sector.  The seasonal soybean cash basis (the difference between
farm and futures prices) generally widens as farmers begin to deliver the new
crop to market.  But the stronger than usual cash basis this fall implies that
farmers have held back on current sales in anticipation of better prices
later.  A recent Internal Revenue Service tax ruling on deferred payments for
forward contracts may also affect farmers' decisions whether to deliver prior
to January 1.  USDA forecast the 1996/97 season average farm price to range
between $6.15 and $6.85 per bushel, down from the October forecast of $6.50-
$7.40.

DOMESTIC CRUSH AND EXPORTS SPEED UP WITH SOFTENING SOYBEAN PRICES

A heavy soybean crush in October followed a weak September pace as the U.S.
harvest progressed and more newcrop supplies became available.  Abundant
supplies are expected to permit 1996/97 domestic crush to reach 1,390 million
bushels.  While still below the record 1994/95 crush, this year's demand for
crushing is expected up 20 million bushels from the tight situation last year.

While the later than usual harvest held down export shipments in September and
October, rising supplies and falling prices are accelerating 1996/97 export
sales of U.S. soybeans and soybean meal.  As of October 31, soybean export
commitments were 16 percent above a year earlier.  China is a chief source of
the spurt in new sales.  The sales pace may quicken further with the larger
and better confirmation of U.S. production.  A lack of competition from
Brazil, due to diminished supplies, is also aiding U.S. exports this fall.  A
smaller expected gain in 1996/97 Argentine soybean production would also
benefit U.S. trade.  U.S. 1996/97 soybean exports are forecast at 870 million
bushels, the largest volume since 1982/83.  On the other hand, sales to the EU
have lagged last year's pace, primarily due to large new EU feed wheat
supplies.  Total 1996/97 soybean imports by the EU, projected down 3 percent
from 14.3 million tons in 1995/96, were forecast 200,000 metric tons higher
this month based on lower U.S. prices.

Greater supplies and lower prices will enable U.S. exporters to sell more
soybean meal abroad.  USDA raised its forecast for U.S. soybean meal exports
to 6.3 million short tons, up from almost 6.0 million in 1995/96.  Prices are
projected to range from $210 to $225 per ton, below the 1995/96 average of
$236.  Meal consumption is anticipated to increase at home as well.  Falling
feed prices will give livestock producers an incentive to expand production
and raise feeding rates.  Domestic disappearance for 1996/97 is forecast at
26.85 million tons, up from 26.6 million last season.  

U.S. export sales of soybean oil have not shown much early strength and
continue to be a drag on the U.S. oilseeds sector.  Like last season, the
outlook for the 1996/97 oil market heavily depends on China.  However, there
are signs for improvement over the disappointing 1995/96 trade.  U.S. soybean
oil prices this fall are more than 4 cents per pound less than a year ago and
down 2 cents from September.  China's imports of soybean oil from South
America have been strong this fall, and when prices soon favor U.S. supplies,
China will probably switch sources.  Projected U.S. soybean oil exports were
raised 50 million pounds this month to 1,750 million.  Lower soybean oil
prices are expected to encourage domestic disappearance, rising 1.3 percent
from 1995/96 to 13,650 million pounds.  Despite these expected increases in
offtake, a large outturn is forecast to push 1996/97 ending stocks of oil to a
record large 2,255 million pounds.  The growing surplus of oil (and potential
oil represented in the larger soybean harvest) may force the U.S. oil price
down to 22.0-23.5 cents per pound.

WORLD SOYBEAN TRADE TO REVIVE

World soybean production for 1996/97 is projected up 7.5 percent from a year
earlier, more than offsetting a decline in other oilseeds production.  This
substitution will help alleviate the imbalance of short protein meal supplies
and surplus vegetable oil stocks.  Based on burgeoning U.S. supplies, 1996/97
world soybean imports are projected to rebound to 32.4 million metric tons
after last year's decline.

Although still representing a record harvest, Argentine 1996/97 soybean
production is projected down this month to 13.0 million tons.  With a large
increase in Argentine wheat area, much more of the soybean crop will be
double-cropped, which would tend to hold down soybean yields.  The decline is
allocated between exports (-300,000 tons) and ending stocks (-200,000 tons). 
Argentina is also expected to have a larger sunflowerseed output, based on a
higher harvested area.

USDA projects Chinese 1996/97 soybean imports to rise to 1 million tons from
nearly 800,000 last year.  Also, China's imports of soybean meal were expected
to rise to 1.6 million tons from 929,000 in 1995/96.

The forecast for Canadian rapeseed crush was reduced 150,000 tons this month. 
Tighter rapeseed supplies, ample crushing capacity, and a low oil price are
squeezing crush margins, which are forcing Canadian processors to restrict
their output.  However, this frees up more supplies for export.  The poor
European rapeseed harvest should attract more Canadian rapeseed exports in
1996/97.  The forecast for Canadian exports was raised this month to 2.4
million tons.

******************************************************************************
Information Contacts:
Mark Ash         Soybeans, Minor Oilseeds, Fats and Oils    (202) 219-0712
Scott Sanford    Peanuts, Cottonseed                        (202) 219-0835
******************************************************************************

The next Oil Crops Outlook is scheduled for 4:00 pm ET Friday, December 13.

Table 1--Soybeans:  U.S. supply and disappearance
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                     Supply                          Disappearance 
        --------------------------------  ------------------------------------
Year                                                     Seed,                
begin.     Beg.   Im-   Produc-  Total    Crush   Ex-    feed,    Total   End.
Sept. 1  stocks  ports   tion                    ports & resid.         stocks
------------------------------------------------------------------------------
         -------------------------- Million bushels---------------------------

1994/95     209    6    2,517    2,731     1,405    838    153    2,396    335
1995/96     335    5    2,177    2,516     1,370    851    112    2,333    183
1996/97 1/  183    5    2,403    2,590     1,390    870    120    2,380    210
------------------------------------------------------------------------------
1/ Forecast.

Table 2--Soybean meal:  U.S. supply and disappearance
------------------------------------------------------------------------------
                 Supply                           Disappearance 
        ----------------------------     ------------------------------------
Year 
begin.      Beg.    Produc-   Total      Domestic   Ex-     Total    End.
Oct. 1    stocks     tion      1/                   ports           stocks
------------------------------------------------------------------------------

         ---------------------------1,000 short tons--------------------------

1994/95     150     33,265    33,479       26,538   6,717   33,256    223
1995/96 2/  223     32,517    32,820       26,625   5,966   32,591    229
1996/97 3/  229     33,066    33,375       26,850   6,300   33,150    225
------------------------------------------------------------------------------
1/ Includes imports.  2/ Estimated.  3/ Forecast.

Table 3--Soybean oil:  U.S. supply and disappearance
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                 Supply                           Disappearance 
        ----------------------------     ------------------------------------
Year 
begin.       Beg.   Produc-   Total     Domestic  Ex-     Total     End.
Oct. 1     stocks    tion      1/                 ports            stocks
------------------------------------------------------------------------------

         -------------------------- Million pounds---------------------------

1994/95     1,103   15,613   16,733       12,916   2,680   15,596   1,137
1995/96 2/  1,137   15,236   16,472       13,480     986   14,466   2,007
1996/97 3/  2,007   15,570   17,655       13,650   1,750   15,400   2,255
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1/ Includes imports.  2/ Estimated.  3/ Forecast.

Table 4--Oilseeds prices received by farmers, U.S.
--------------------------------------------------------
Marketing      Soy-  Cotton-  Sun- 
 year         beans   seed   flowers  Peanuts  Flaxseed
--------------------------------------------------------
              $/bu.   $/ton   $/cwt   Cents/lb  $/bu.
                                     
1990/91        5.74  121.00    10.80    34.70   5.27
1991/92        5.58   71.00     8.69    28.30   3.52
1992/93        5.56   97.50     9.74    30.00   4.12
1993/94        6.40  113.00    12.90    30.40   4.25
1994/95        5.48  101.00    10.70    28.90   4.63
1995/961       6.80  106.00    11.35    29.30   5.25

1994/95
September      5.47  101.00    10.70    30.60   4.55
October        5.30   96.00    10.50    28.60   4.52
November       5.36  107.00    10.60    25.90   4.52
December       5.41  103.00    10.60    25.80   4.72
January        5.47   95.00    10.50    25.50   4.76
February       5.40   70.00    10.80     NA     4.94
March          5.51    NA      10.40     NA     5.13
April          5.55    NA      10.70     NA     5.10
May            5.56    NA      10.60     NA     4.91
June           5.68    NA      10.70     NA     5.03
July           5.90    NA      11.50     NA     5.11
August         5.83  100.00    11.40    30.60   5.21

1995/96
September      5.98  100.00    11.00    29.70   5.11
October        6.15   99.00    11.00    28.60   5.11
November       6.40  114.00    10.80    29.50   5.17
December       6.76  116.00    10.60    28.60   5.03
January        6.77  107.00    11.00    29.80   5.27
February       7.01  117.00    11.50     NA     5.18
March          7.00    NA      11.90     NA     5.28
April          7.43    NA      12.50     NA     5.31
May            7.69    NA      13.60     NA     6.03
June           7.41    NA      14.30     NA     5.88
July           7.62    NA      13.60     NA     6.19
August         7.82  118.00    12.70     NA     6.15

1996/97
September      7.79  134.00    12.00    27.70   5.89
October1       6.85  127.00    11.00    26.20   6.51
--------------------------------------------------------
1 Preliminary.
Table 5--Vegetable oil prices
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                      Cotton-  Sun-       
Marketing    Soybean   seed   flower Peanut  Corn  
 year          oil2     oil3    oil4  oil5    oil6 
---------------------------------------------------
                     Cents/lb.
                                                   
1990/91       21.00    24.10   23.67  45.50  27.50 
1991/92       19.10    22.83   21.63  27.30  25.82 
1992/93       21.40    30.07   25.37  27.40  20.90 
1993/94       27.00    30.30   31.08  43.20  26.38 
1994/95       27.51    29.23   28.10  44.30  26.47 
1995/961      24.70    26.53   25.40  40.00  25.55 
                                                   
1994/95                                            
October       27.06    27.81   28.90  46.00  24.73 
November      29.84    30.72   29.40  50.88  24.75 
December      30.61    31.83   30.63  53.80  24.75 
January       29.04    28.70   29.25  50.25  28.01 
February      28.15    29.95   27.66  41.83  27.26 
March         28.33    27.14   27.97  41.00  28.17 
April         26.30    27.61   26.89  41.25  27.30 
May           26.00    27.51   26.34  40.25  26.42 
June          26.78    30.04   27.30  39.00  26.61 
July          27.60    30.63   28.69  39.13  27.38 
August        26.56    30.26   27.47  41.50  26.35 
September     26.26    28.61   27.41  41.30  25.93 

1995/96
October       26.57    27.61   27.49  42.50  26.05
November      25.42    26.27   26.25  41.63  25.54
December      24.76    26.10   25.98  39.20  24.99
January       23.52    24.45   24.65  37.25  24.52
February      23.49    24.35   24.23  36.00  24.30
March         23.60    24.25   24.28  36.60  24.34
April         25.70    26.77   25.63  39.25  26.60
May           26.50    28.46   26.38  42.80  27.98
June          24.95    27.94   25.72  43.00  25.66
July          24.10    28.25   24.58  43.00  25.46
August        23.99    27.81   24.90  42.60  24.33
September     23.92    26.13   24.90  40.80  24.14

1996/97
October1      21.95    24.55   22.80  41.50  22.67
-------------------------------------------------------------------------
1 Preliminary 2 Decatur 3 PBSY Greenwood MS
4 Minneapolis 5 Southeast mills 6 Chicago

Table 6--Oilseed meal prices
---------------------------------------------------
             Soy-   Cotton   Sun-           
Marketing    bean    seed   flower  Peanut  Linseed
 year        meal2   meal3   meal4   meal5   meal4
---------------------------------------------------
                        $/Short ton
1990/91     181.40  130.75   88.00  193.00  130.10
1991/92     189.20  140.50   76.80  154.50  125.25
1992/93     193.75  161.78   89.00  172.90  133.60
1993/94     192.86  164.30   94.00  194.91  139.55
1994/95     162.55  112.02   62.70  128.94   95.85
1995/961    235.90  190.74  123.75  202.70  159.05

1994/95
October     168.50  134.40   75.00  151.25  122.50
November    161.00  120.50   69.50  147.50  110.00
December    156.90  114.20   52.50  127.00   95.60
January     156.40  106.75   50.00  105.00   82.40
February    151.30   97.50   46.88  107.50   85.25
March       156.90  100.30   52.50  119.00   90.00
April       161.90   98.10   62.50  125.00   94.40
May         159.10   92.75   60.90  123.75   85.00
June        160.40  108.75   62.38  134.00   85.00
July        170.45  116.90   73.75  138.75   92.50
August      166.70  116.50   83.75  136.25   95.00
September   180.99  137.60    NA    142.00  112.50

1995/96
October     193.90  153.25   82.88  132.50  131.00
November    204.10  165.00   99.00  175.00  151.67
December    223.60  185.80  122.50  204.00  143.75
January     232.00  208.80  135.00  220.00  142.00
February    228.30  202.80  130.00  215.00  143.75
March       226.57  195.60  123.50  210.00  155.00
April       249.30  220.00  133.00  210.00  174.00
May         244.30  191.25  137.00  212.00  177.00
June        238.80  192.20  135.00  210.00  178.75
July        252.50  201.56  135.00  224.25  174.00
August      261.20  193.10  126.25  227.00  170.00
September   276.40  193.10  125.60  192.80  167.50

1996/97
October1    248.60  182.50  116.00  170.00  175.00
----------------------------------------------------------------------------
1 Preliminary 2 Hi-pro Decatur 3 41% Memphis 4 Minneapolis 5 50% SE mills

END-OF-FILE