The new year got off to a big start for U.S. soybean trade, with sales and shipments to China totaling nearly 2 million metric tons for just the first week in January, according to the latest trade data.

The USDA is reporting Thursday that Chinese buyers contracted in the first seven days of January to purchase 758,300 metric tons of U.S. soybeans for delivery in the 2020-21 marketing year and 66,000 tons for delivery in 2021-22. The new crop export sales to China could actually be much higher. The USDA also reported 260,000 tons of export sales to “unknown destinations,” which often means delivery to China.

As to physical shipments, the USDA reported total exports of 2.04 million tons from Jan. 1- 7, with most of that (1.166 million tons) being sent to China. Exports to Spain came in a distant second at 143,000 tons.

The strong week for soybean export sales and shipments bolsters USDA’s decision this week to boost its forecast for 2020-21 U.S. soybean exports to 60.69 million tons. That’s up from the December forecast of 59.87 million tons and a big increase from last year’s total of 45.78 million tons.

Strong international demand – especially from China as it rebuilds its swine herd and domestic stockpiles – along with newly lower production forecasts for the U.S. and Argentina and a delayed Brazilian harvest are all pointing to very tight supplies.

That’s especially true in the U.S., says Mac Marshall, vice president of market intelligence for the United Soybean Board and the U.S. Soybean Export Council.

“With the downward revision to yields, the U.S. crop size was reduced by 35 million bushels,” Marshall said in reaction to USDA’s latest World Agricultural Supply and Demand Estimates report. “Most critically, the downward revision of production contributed to a reduction in projected 2020-21 ending stocks from 175 million bushels to 140 million bushels. Factoring in domestic use and exports, this ending stocks figure is equivalent to about 11 days use, further tightening what was already a very tight balance sheet.”