Soybean Market Faces Supply Pressure as Indian Production Woes Loom

The global soybean market is navigating a turbulent period as adverse weather conditions in India threaten to dampen production, stirring uncertainty across key trade hubs. Reports from recent ground-level surveys indicate that India’s soybean crop could decline by 5–15% this year, a development attributed to erratic and uneven rainfall in major producing states including Madhya Pradesh, Maharashtra, and Rajasthan. This comes at a time when global inventories remain sensitive to weather-driven shocks, and as speculative activity on exchanges adjusts in anticipation of tighter supply.

Given India’s status as an emerging player in both production and consumption, any notable shift in its output typically finds swift resonance in regional and global price action. Market participants are monitoring not only rainfall patterns but also the duration and intensity of dry spells, which have been particularly harmful to crop development this season. The dual threat of excessive rainfall in some areas and extended drought in others has created what traders describe as a “double-edged sword,” challenging yield outlooks.

With output forecasted to fall below average per-hectare expectations, the market outlook tilts bullish for the near term. These fundamentals are reflected in recent price stabilization and upward movement at major exchanges and FOB (Free on Board) offers globally. As the market digests evolving reports from India and tracks ongoing weather patterns, positioning for upside risk remains a focal point for both growers and processors worldwide.

📈 Prices

Origin	Location	Type	FOB Price (EUR/kg)	Prev. Price (EUR/kg)	Last Update	Sentiment
US	Washington D.C.	No. 2	0.35	0.35	2025-08-21	Steady/Watchful
IN	New Delhi	Sortex Clean	0.72	0.72	2025-08-21	Supportive/Bullish
UA	Odesa	–	0.34	0.35	2025-08-21	Soft/Weakening
CN	Beijing	Yellow	0.71	0.70	2025-08-20	Firm/Rising
CN	Beijing	Yellow, Organic	0.79	0.78	2025-08-20	Strong/Firm
IN	New Delhi	Soya powder (lecithin, organic)	2.77	2.77	2025-08-07	Steady

🌍 Supply & Demand Drivers

• Indian production cut by 5–15% amid erratic rainfall and drought in main states (Madhya Pradesh, Maharashtra, Rajasthan).
• Crop stress and uneven yield expected to reduce average outputs to 4,000–5,000 kg/ha in hardest-hit districts.
• US crop outlook stable but closely watched as weather impacts Midwest states during late growing stages.
• Chinese demand remains firm, with notable imports for feed and oil sectors; steady import pace supports floor prices on FOB China offers.
• Ukrainian offers show mild weakening, likely on export competition, ample old-season stocks, and moderate Black Sea weather.
• Global speculative positioning has turned neutral-bullish, with funds cautious on net new shorts given South Asian production risk.

📊 Market Fundamentals

• USDA latest WASDE report signals broadly stable US and Brazilian carryout stocks, but Indian drawdown tightens Asian balances.
• South American supplies entering the global market, but logistics and export bottlenecks in Brazil/Argentina remain sporadically disruptive.
• China’s ongoing stockpiling and higher crush margins maintain import momentum, underpinning international price levels.
• Domestic Indian soy derivative markets (meal, oil) expected to firm as raw bean supply contracts.

🌦️ Weather Outlook & Crop Impact

• Madhya Pradesh: Continuing risk of sporadic rains and drought days; further stress could extend production losses into September.
• Maharashtra/Rajasthan: Below normal precipitation forecast persists for coming week; irrigation shortfalls reinforce downward yield revision.
• US Midwest: Key regions (Iowa/Illinois) see moderate rainfall, adequate soil moisture, limited weather threat for remainder of August.
• South America: Brazil/Central Argentina report neutral short-term weather, with no major threats in current outlook.

🌐 Global Production & Stocks Comparison

Country	2024F Production (‘000 MT)	Key Comments
Brazil	155,000	Strong crop, steady exports
US	113,000	Stable yields, weather-managed
India	10,000–11,000	Down 5–15%, rain/drought impact
China	18,500	Flat, high imports mitigate risk
Argentina	41,000	Logistics mixed, output stabilized

📆 Trading Outlook & Recommendations

• Short-term: Bullish tone on India supply tightening; good opportunity for producers to lock in premiums, especially ex-India and China offers.
• Buyers: Secure forward contracts where supply risk highest (India, China), consider expanding origins portfolio to Brazil/US with stable offers.
• Processors: Watch for potential run-up in meal/oil parity in India; use physical coverage for upcoming demand cycle.
• Speculators: Monitor Indian weather, CBOT net fund positions, and WASDE updates for cues on volatility spikes.
• Risk: A reversal in weather could stabilize Indian forecast, triggering short-term corrections; hedge accordingly.

⏳ 3-Day Regional Price Forecast

Region/Exchange	Spot Price (EUR/kg)	3-Day Trend	Forecast Sentiment
CBOT (US)	0.35	+1.2%	Bullish/Stable
Euronext (EU)	~0.41	+0.8%	Supportive
FOB India	0.72	+1.5%	Bullish
FOB China	0.71	+1.0%	Firm