Soybeans Ease From Weather Rally as Crush Stays Profitable
CBOT soybeans, meal and oil ease after a weather-driven rally, while FOB cash values stay steady and global supply prospects remain comfortable.
Prices
Across the soybean complex, today’s board action is mildly lower and consistent with a pause after the recent rally. Nearby CBOT soybean futures around November 2026 are down roughly 0.3% on the day, with front contracts slipping 3–4 cents after last week’s 1.7–1.8% weekly advance driven by US weather worries and strong crush economics.
Soyoil futures on CBOT show a parallel, gentle downward adjustment of around 0.5–0.7% along the curve, from about 74.3 to 70.1 US cents/lb between August 2026 and May 2027. Further out to late 2028–29 the strip retreats toward the low‑60s, underlining expectations of ample vegoil supply as additional South American capacity comes online. Soymeal is comparatively firm: front contracts around August–December 2026 trade near 323–327 USD/short ton, virtually unchanged intraday, while deferred 2027–28 positions hold modest premia around 329–332 USD/ton, reflecting resilient feed demand.
Cash offers confirm this stabilisation: US No. 2 FOB soybean values around Washington D.C. are steady near 0.65 EUR/kg, almost unchanged over the past week, while Ukrainian FOB Odesa levels hover around 0.36–0.37 EUR/kg after edging off early‑July highs. Indian clean sortex beans remain the most expensive origin at about 0.89 EUR/kg FOB, whereas non‑GMO and organic Chinese beans range between roughly 0.78–0.84 EUR/kg FOB, showing only minor week‑on‑week moves.
*Approximate EUR conversion for indication only.
Supply & Demand
Global fundamentals remain broadly comfortable. Brazil is on track for another record soybean harvest in 2026, with official statistics pointing to about 174 million tonnes, up nearly 5% year on year, while private forecasters now see 2026/27 output potentially reaching around 180 million tonnes despite El Niño concerns.
Brazilian export capacity is being fully utilised: the national exporters association recently raised projected July shipments of soybeans and meal, underscoring strong demand from China and other Asian buyers at current price levels. Meanwhile, US soybean crop conditions have improved modestly into late July as rains eased earlier dryness in parts of the Midwest, easing immediate yield fears and tempering the weather‑risk premium.
On the demand side, soymeal usage in livestock and poultry rations remains robust, particularly in Asia and the Americas, supported by competitive meal prices versus alternative proteins. Soyoil consumption benefits from both food demand and continued blending mandates in biodiesel, even as some discretionary blending becomes more price‑sensitive. The current pattern—stable meal, slightly softer oil—is consistent with a crush driven increasingly by protein rather than vegoil margins.
Fundamentals & Weather
Fundamentals across the board point to a market that is well supplied but finely balanced. CBOT soybeans, soymeal and soyoil curves all show mild contango from 2026 into 2028/29, indicating that forward supply is perceived as adequate and storage costs are being covered without signalling acute tightness. Open interest is highest in the November 2026 soybean contract, highlighting its role as the primary global benchmark for the new US crop.
Weather remains the key swing factor. In the US Midwest, short‑term forecasts point to mostly seasonable temperatures with occasional showers, supportive for pod‑setting and filling, though any return of prolonged heat in early August would quickly re‑price yield risk. In Brazil, analysts are increasingly focused on El Niño’s potential to cap 2026/27 yield growth; recent reports already project Brazilian soybean production to grow by less than 1% next season as farmers react to narrower margins and climatic uncertainty.
Crush economics remain healthy. Recent estimates place the US soybean crush margin near 2.8 USD/bu, with meal and oil values around 7.1 and 7.9 USD/bu respectively. These margins incentivise continued high utilisation rates at processing plants in both North and South America, effectively transforming ample bean supplies into products and helping to absorb inventories. As long as these margins persist, downside in raw bean prices is likely limited, even if weather risk moderates.
Trading Outlook
- Producers: Use the current pullback in futures and still‑firm basis to extend hedges on a portion of 2026/27 output, especially in regions with favourable yield prospects. Consider layered selling strategies rather than aggressive one‑off sales to preserve upside in case of August weather stress.
- Crushers: With crush margins attractive and the forward curve in mild contango, locking in bean input costs via nearby futures while keeping product sales flexible remains sensible. Selling soymeal forward into strong feed demand while retaining some optionality in soyoil may optimise the risk profile.
- Buyers & Importers: For Asian and European buyers, the recent easing in CBOT and steady FOB offers present an opportunity to cover a share of Q4 2026 and Q1 2027 needs. However, maintain some open coverage to benefit if record South American supplies and benign US weather ultimately push prices lower into harvest.
3‑Day Price Indication (Directional)
- CBOT Soybeans (Nov 26): Slightly bearish to sideways; market likely to consolidate after recent gains unless US weather turns hotter/drier again.
- CBOT Soymeal (Dec 26): Neutral to mildly firm; feed demand should continue to underpin spreads versus beans.
- CBOT Soyoil (Dec 26): Slightly bearish; comfortable vegoil outlook and soft energy complex weigh on the upside.