Following the successful summit meeting between the presidents of the USA and China, the market started the week on a euphoric note. Beijing's commitment to import up to 12 million tons of US soybeans by January initially caused prices to rise significantly. Additional impetus came from a surprising agreement with Bangladesh, which is to purchase around one billion dollars worth of US beans. However, the euphoria began to crumble noticeably by the middle of the week. Traders pointed to China's continued high import tariffs and Beijing's increasing activities on the Brazilian market. The unclear data situation as a result of the US government shutdown added to the uncertainty. Prices had fallen significantly by Friday. This was partly due to the fact that no quantities were given at a media-accompanied buying ceremony held by the Chinese Cofco. The sharp rise in Brazilian exports also had a negative impact. According to Anec, they could rise to almost 3.8 million tons in November, which would be a significant increase on the previous year.
In the soybean meal market, contracts initially followed the upward trend, but quickly came under pressure again. One possible explanation for this is the hesitant development of exports to date. Official figures are also lacking here, but estimates range from modest to solid. In the case of soybean oil, the news situation remained manageable and the expected sales volumes are at a low level.
The rapeseed and canola markets were dominated by political uncertainties. Although there were isolated price increases, there was no diplomatic progress in the dispute between Canada and China. Towards the end of the week, losses in the soy complex and increasing competitive pressure also pushed prices down significantly in Paris.
ZMP Live Expert Opinion
The recent agreements with China initially boosted the soybean market, but the optimism already seems to have faded. The combination of a lack of transparency as a result of the US shutdown, ongoing Chinese import tariffs and strong Brazilian competition has made many market participants more cautious. The decisive factor will be whether and at what speed the announced purchases actually appear in the USDA reporting system. Demand in the soybean meal and soybean oil market has so far remained subdued. The rapeseed market is also directionless, partly due to the political stand-off between Canada and China. Overall, the soy complex is likely to remain under pressure for the time being, unless reliable export figures provide new impetus.
You see historical data because you're not logged in or not a ZMP Live+ member. Get your information advantage now!
