Soybeans Under Pressure: Brazil’s Export Surge Meets Softer Demand

Soybean prices remain under pressure, but the recent pace of decline has slowed as the market waits for fresh guidance from the upcoming USDA WASDE report and digests record‑strong Brazilian exports. After weeks of selling driven by ample South American supplies and weaker vegetable oil markets, soybeans are finding a fragile floor. Good crop conditions across the US Midwest, resilient export flows from Brazil and softer EU import demand are reinforcing a fundamentally well‑supplied picture. At the same time, FOB cash indications show only modest week‑on‑week moves, suggesting many traders are pausing ahead of key data releases and watching weather in the US and South America for the next directional cue.

Prices

FOB cash offers indicate a broadly soft but stabilizing market. US No. 2 soybeans out of Washington D.C. are around EUR 0.60–0.62/kg equivalent, with a slight uptick versus late May. Indian sortex‑clean beans near New Delhi trade roughly at EUR 0.82–0.85/kg, also marginally firmer. Ukrainian origin from Odesa remains the cheapest at about EUR 0.32–0.34/kg, reflecting both freight risk and strong competition.

In China, conventional yellow beans hover near EUR 0.66–0.68/kg, while organic yellow beans command a premium at about EUR 0.75–0.77/kg. Overall, price moves over the past two weeks have been small, consistent with the observation that the earlier downward trend has lost momentum and that the market is entering a waiting phase ahead of new fundamental signals.

Supply & Demand

The global balance remains clearly supply‑heavy. In the EU, soybean imports since the start of the 2025/26 marketing year (from July) total 12.95 million tonnes, about 5% below last year, while soymeal imports are down 3% to 17.65 million tonnes. Declines in rapeseed (‑29%) and palm oil imports (‑5%) underline generally weaker vegetable oil and protein demand in Europe rather than any shortage on the supply side.

Brazil is solidifying its role as dominant exporter. For June, the exporters’ association ANEC has lifted its soybean export forecast by 2 million tonnes to 14.38 million tonnes, likely surpassing last year’s 13.79 million tonnes and following very strong May shipments above 15 million tonnes. With a record 2026 soybean harvest, Brazil is on track to ship about 72.9 million tonnes in the first half of the year, keeping the global pipeline extremely well supplied and exerting lasting pressure on international prices.

Fundamentals

Weather in the US Midwest remains broadly favourable for soybean development. Warm temperatures combined with recurring showers support crop growth, and the recent slight drop in weekly crop ratings from 66% to 65% good‑to‑excellent is viewed as statistically insignificant. Markets largely discount this minor downgrade, focusing instead on the overall constructive weather pattern and the prospect of a sizeable US 2026 crop.

On the demand side, soft vegetable oil prices and weakness in related markets (rapeseed and palm oil) weigh on the oilseed complex as a whole. Malaysian palm oil futures recently retreated to a two‑week low, giving back prior gains as subdued export demand emerged, adding further bearish sentiment to soybeans via the oilshare channel. At the same time, record or near‑record Brazilian exports underline that origin competition will remain intense, limiting any sustained price recovery unless weather problems emerge or demand surprises to the upside.

Weather Outlook

Short‑term forecasts for the central US indicate continued above‑normal temperatures with intermittent thunderstorms, followed by some moderation later in the week as a front moves through the upper Midwest. For soybeans already planted, this pattern remains broadly supportive, ensuring sufficient moisture while avoiding prolonged heat stress in most key states.

Given the already high share of US soybean area rated good to excellent, weather is currently a stabilizing rather than bullish factor. Only a shift toward persistent drought or extreme heat across major production belts would significantly change yield expectations and the market narrative in the coming weeks.

Trading Outlook

• Short‑term bias: Mildly bearish to sideways. Ample Brazilian exports, good US crop conditions and softer EU import demand argue against a rapid price rebound.
• Producers: Consider scaling in hedges on price rallies ahead of the WASDE release, especially in South America where export programs are already heavy and basis could weaken further if global demand disappoints.
• Consumers (crushers, feed mills): Maintain or modestly extend coverage on nearby needs while the market consolidates near recent lows; retain some flexibility for Q4 in case of weather‑driven setbacks in the US.
• Traders: Expect range‑bound trade into and shortly after the WASDE, with volatility spikes likely around the report. Spreads should continue to reflect comfortable nearby supply unless US weather turns materially adverse.

3‑Day Price Indication

• CBOT futures (reference in EUR/tonne): Sideways to slightly softer as the market digests Brazilian exports and positions for WASDE.
• FOB US Gulf / Atlantic: Stable to marginally weaker in EUR terms amid strong competition from Brazil and Ukraine.
• FOB Brazil: Firm basis but capped flat prices; export pace stays high, limiting any significant upside over the next three sessions.