Soybean

Soy meal was down $4.00/ton, with front month soy oil 2 points lower. Managed money in soybean futures and options added 6,953 contracts to their net long position of 177,047 contracts last week. Meanwhile in soy oil, they were at their largest recorded net short position of -73,540 contracts. No deal was reached in two days of negotiations between the US and China, with both sides suggesting some minor issues had been solved but none of the major requests. BAGE estimated the soybean crop in Argentina at 61.8% complete, in front of the normal pace of 56.4%.

Futures contracts of soybean fell on the NCDEX, tracking weakness in bellwether contracts on the CBOT. Soybean contracts on CBOT were down this week as fears of a trade war between the US and China resurfaced, stoking concerns of an oversupply. China is the largest buyer of soybean from the US and has started to source some of its requirement from Brazil, the second largest producer of the oilseed after US. Sowing of soybean may be higher this season compared with a year ago owing to lucrative rates. Lower demand for Indian meal from overseas buyers is also seen weighing on soybean prices.

China buying beans in Canada, in Brazil, mostly Brazil, but very deliberately not buying anything from the U.S. China canceled a net 62,690 metric tons of U.S. soybean purchases in the two weeks ended April 19.

Soybean prices rose marginally in Indore tracking gains in bellwether contracts on the CBOT and lower-than-usual supplies. Average arrivals in the first week of May last were estimated at 50,000 bags. CBOT soybean was up on worries of lower output in Argentina and higher exports from the US.

Soybean oil exports in 2017/18 (September-March) reached a record 104.2 KMT that is up 3.3% on the year (100.9 KMT). Ukrainian soybean oil exports totaled 19.6 KMT in March 2018. This is as much as in the previous month but down 17.3% from March 2017, when export supplies from Ukraine hit an all-time high of 23.7 KMT. UkrAgroConsult expects 2017/18 soybean oil exports at record high level of 160 KMT.

The rebound in soybean crushing margins is down to more than Argentine drought. The drought in Argentina certainly contributed to the increasing soy crush margins.

Soybean contracts on NCDEX fell about 1% because of lower export demand for soymeal. The most-active May contract was down 0.8%.

Due to the recent devastating drought, soybean production in Uruguay is forecast to drop to 1.7 million tonnes in 2017-18. This is a drop of 43% compared to the USDA’s original estimate of 3 million tonnes. Soybean crush for 2017-18 is revised down to 60,000 tonnes — a 20% decline from the previous crop year due to lower soybean supplies. The USDA forecasts a recovery for both soybean production and crush in 2018-19. It predicts output of 3 million tonnes and crush at 80,000 tonnes, which is a return to pre-drought historical levels.

US farmers, tackling a late start to spring, have fallen even further behind on sowings, with the lag expanding by a further 1.6m acres last week, although an improved weather outlook is raising hopes for playing catch-up. Farmers seeded a little over 27m acres of the 219m acres they intended to plant with 10 major spring crops, such as corn, cotton, soybeans and spring wheat. However, a small lag, equivalent to 270,000 acres, opened up in cotton too, while the delay in oat plantings expanded, in percentage terms, to 25 points, equivalent to nearly 700,000 acres in area.

Exports of soybean from Paraguay are expected to be 6.1 million mt in 2018, according to USDA figures, up 200,000 mt on a previous estimate on the expectation of aggressive buying in Argentina.

US plantings have seen a substantial week-on-week increase as a spell of dry weather and warmer ground temperatures fired plantings across corn, spring wheat and soybeans,: USDA.

A deprecating currency and firmer premiums have pushed soybean farm prices in Mato Grosso above the total cost of production, which may see a further increase in forward selling.

Soybean futures saw weakness into the close, with the nearby contracts 7 to 7 3/4 cents lower. Soy meal was down $1.10/ton, with front month soy oil 8 points in the red. The USDA reported a private export sale of 120,000 MT of soybeans for 18/19 to Argentina. Soybean export inspections during the week of 4/26 totaled 679,379 MT. That was 43.83% larger than the week prior and 22.53% above the same week last year. This afternoon’s Crop Progress report indicated that the US soybean crop was 5% planted on Sunday. That is even with the average but 4% lower than this time last year.

Indian farmers are likely to expand soybean planting areas by nearly 15 percent after the government raised edible oil import tax to the highest level in more than a decade, lifting domestic oilseed prices to nearly two-year highs. Higher production of the main summer-sown oilseed could help India, the world’s biggest vegetable oil importer, trim costly imports from Brazil, Argentina, Indonesia and Malaysia. It could also mean a boost in exports of soymeal, a key animal feed, to Asian buyers such as Japan, Vietnam and Bangladesh. Soybean has been giving farmers good returns. Indian soymeal once accounted for nearly a quarter of all Southeast Asian imports, but the country’s share has been falling due to rising domestic soybean consumption amid stagnant production.

Soybean prices rose by Rs 42 to Rs 3,721 per quintal in futures trade today on accumulation of bets backed by rising overseas trend. Marketmen said widening of bets by speculators in tune with upbeat overseas sentiment, supported the upside in soybean futures prices. At the NCDEX, soybean for delivery in June contracts shot up by Rs 42, or 1.14 per cent.

Soy meal led the way, up $14/ton, with front month soy oil down 38 points. Managed money in soybean futures and options trimmed their net long position by 22,874 contracts to 170,094 contracts in the week that ended 4/24. Canola acreage in Canada is seen at 21.383 million acres in 2018, a 7% drop from a year ago and well below most expectations. Stats Canada soybean acreage intentions were reported at 6.452 million acres, down 11.41% from 2017. BAGE estimates that the Argentine soybean crop is 54% harvested, compared to the average of 43.4%. Recent production estimates have been around 38 MMT, with crushers drawing down stocks and importing soybeans in an attempt to maintain soybean meal exports at typical May levels.

Soybean contracts on NCDEX hit the 3% lower circuit, tailing losses on CBOT and due to weak demand from crushers. The most-active May futures were down 3% at 3,611 rupees per 100 kg. Arrivals were steady in Madhya Pradesh and also unchanged in Maharashtra.

Argentina’s soybean harvest accelerated over the past week with harvested areas reaching 54% of the planted acreage, an increase of 14.4 percentage points on the week and up 21.7 percentage points on last year: BAGE. The accumulated harvested volume crossed the 22 million mt mark, with the total expected at 38 million mt, unchanged on the week. Average yields slipped back from 2.56 mt per hectare last week to 2.38 mt per hectare, as the majority of lots in good condition are already harvested and action now moves towards areas that have suffered more severely from the drought.

According to current information of the State Statistics Committee, sunseed stocks in Ukraine totaled 3512.9 KMT as of April 1, 2018 that is 9.5% less than by the same date last year (3881.3 KMT). This included 1714.8 KMT held by growers (down 369.6 KMT or 17.7% from the same date in 2017), while storing and crushing companies accounted for 1798.1 KMT (down 1.2 KMT or 0.07%). As of April 1, 2018, soybean inventories held by crushing companies were down 16% on the year at 367.8 KMT against 438.3 KMT as of April 1, 2017. At the same time, rapeseed stocks were almost 10% lower than a year ago (57.1 KMT and 63.3 KMT, respectively).

Soybean seed shortage is estimated at 9,317 tn in 2018-19 (Jul-Jun) kharif season owing to lower crop in key growing states. Against the requirement of 290,976 tn soybean seed, the country is likely to have 281,659 tn seeds available this year. Untimely rains in Madhya Pradesh, Maharashtra and Telangana during the harvesting season hit the crop, which will result in lower availability of seeds this year. Madhya Pradesh and Maharashtra are the leading growers of the oilseed.