Soy Market Sees Mixed Signals: Global Prices Edge Up Amid Volatile Fundamentals

The global soybean market is currently navigating a complex landscape marked by moderate price gains in core segments, continued volatility across international exchanges, and persistent uncertainty from shifting fundamentals. Futures trading on the Chicago Board of Trade (CBOT) has demonstrated moderate upward movement in the front-month contracts, particularly for soybeans and soybean oil, while deferred positions have posted notable declines. These diverging trends reflect market anxieties over supply chain pressures, export demand from China, and mixed weather prospects in South and North American growing regions.

Spot prices in physical markets also reflect regional disparities, with European import values from China rising steadily over the past week, while US and Black Sea FOB offers remain flat. Additionally, recent weekly declines in soybean meal futures spotlight questions about feed demand recovery. Market sentiment has shifted towards cautious optimism given robust US exports and slightly friendlier weather outlooks in the Midwest and Brazil, yet fund positioning remains neutral as traders weigh the dual threats of tight global stocks and macroeconomic headwinds.

Overall, with robust open interest, relative stability in cash markets, and a watchful eye on weather-driven yield shocks, the soybean market is poised for a period of heightened volatility. Market participants should closely monitor USDA WASDE updates and the pace of Chinese purchasing, as these factors are likely to provide the next directional cues.

📈 Prices: Key Global Soybean Markets

Exchange/Market	Contract	Last Price	Weekly Change	Currency	Sentiment
CBOT Soybeans	Jul 25	1,040.50	+0.85%	US-Cent/bu	Modestly Bullish
CBOT Soybean Oil	Jul 25	54.07	-1.15%	US-Cent/lb	Bearish
CBOT Soybean Meal	Jul 25	268.50	-1.94%	USD/Short ton	Bearish
DCE Soybeans	Jul 25	4,156	-0.82%	CYN/t	Bears in Control
Physical Export (China FOB, Organic)	–	0.76	+0.01	EUR/kg	Bullish
Physical Export (China FOB)	–	0.68	+0.01	EUR/kg	Bullish
Physical Export (US FOB)	–	0.35	=	EUR/kg	Stable
Physical Export (Ukraine FOB)	–	0.34	=	EUR/kg	Neutral

🌍 Supply & Demand Drivers

• USDA WASDE (July): Markets await new crop estimates; previous reports showed marginal downward adjustments in US ending stocks and a reduction in Brazilian output on drought concerns.
• Chinese Imports: Demand remains strong, supporting US and Brazilian FOB offers; recent pace of imports faster than the 5-year average amid Pork sector recovery.
• Speculatory Positioning: Hedge funds remain neutral after partial long liquidation in June, reflecting caution over external macro drivers.
• Global Meal Demand: Feed sector demand for soybean meal remains tepid, holding back more vigorous upside in soy complex prices.
• Weather Shocks: Persistent focus on US Midwest rainfall and Southern Brazilian drought, both capable of reshaping production and global logistics.

📊 Fundamentals: Production, Stocks & Trade Flows

Country	2024/25 Output (Mt)	2024/25 Ending Stocks (Mt)	YoY Change (%)
USA	119.0	8.5	-2%
Brazil	152.0	27.5	-4%
Argentina	47.5	2.5	+8%
China (imports)	107.0	NA	+3%
EU (imports)	16.5	NA	Flat

• Global Stock-Use Ratio: Near multi-year lows, adding risk premium to old crop months.
• Major Exporters: The US and Brazil dominate, with Ukraine and India secondary but price-competitive.

🌦️ Weather Outlook & Yield Impacts

• Midwest US: Moderately favourable rain forecast for the next 10 days; heat indices to ease, reducing immediate drought risk. Yield potential is stable to slightly improved.
• Brazil South: Improving soil moisture from recent showers, but subsoil deficits still a concern for late-planted beans.
• Argentina: Normal to above-average precipitation expected, supporting late crop conditions.

Short-term forecasts now imply that above-average yields are possible in the US, while Brazilian uncertainty lingers.

📆 Trading Outlook & Recommendations

• Watch USDA WASDE & Crop Reports: Key for changes in projected US and Brazilian supply.
• Monitor Chinese Purchase Volumes: Early signs of stronger-than-forecast demand may spark short-covering rallies.
• Physical Exporters (EUR): Consider forward sales on recent price strength, focus on volatility management for Q3 & Q4 contracts.
• Importers: Monitor spot and deferred premiums; consider accumulating on dips given limited downside risk.
• Speculators: Neutral to mildly bullish stance recommended, with stops below key support in deferred contracts.

🔮 3-Day Regional Price Forecast (Key Exchanges)

Exchange	Contract	Current Price	3-Day Forecast	Currency
CBOT	Jul 25	1,040.50	1,038 – 1,050	US-Cent/bu
DCE	Jul 25	4,156	4,135 – 4,180	CYN/t
Physical Export (China FOB, Organic)	–	0.76	0.76 – 0.78	EUR/kg
Physical Export (US FOB)	–	0.35	0.34 – 0.36	EUR/kg