Prices in the soy complex were under noticeable pressure last week. The January soybean contract on the CBoT fell in five consecutive sessions and recently closed at a seven-week low. The lack of impetus from China and the very positive production outlook in Brazil were decisive for the downward trend. Despite several export reports from the USDA, trade volumes remained disappointing from a market perspective. Even a larger booking by China in the previous week was unable to fulfill expectations of a year-end spurt. At the same time, the ongoing auction marketing of imported beans by the Chinese state-owned company Sinograin caused additional skepticism as to whether new US deliveries would be taken up soon. Weak export inspections and a disappointing NOPA crush result increased the selling pressure. Soybean meal also followed the negative trend over the course of the week, while soybean oil lost additional value in the wake of falling crude oil prices.
The rapeseed market in Paris again saw significant losses. The February price slipped below the €470 mark and closed at €461 per tonne on Friday. This was due to the weak overall environment and the lack of impetus from the domestic market. The negative sentiment on the canola market is currently weighing particularly heavily. On the ICE in Winnipeg, the January contract fell below the Can-$ 600 mark at the beginning of the week, before March also reached this level at the end of the week. The Canadian Agricultural Agency once again raised its estimate for ending stocks significantly, which further increased concerns about overfilled warehouses. The ongoing export problems in trade with China thus remain a key issue.
ZMP Live Expert Opinion
The oilseed markets are still stuck in a clearly bearish trend. While hopes of a year-end revival in the US soybean export business are fading, the recovery in soybean meal and soybean oil is also failing to materialize. Strong Brazilian harvest expectations are exacerbating the oversupply, especially as China has not yet become active on the US market to any significant extent. The trade conflict with China is weighing heavily on canola prices, which is increasingly reflected in growing inventories. Rapeseed is also following the weak international market environment. A turnaround would currently require clear impetus such as a noticeable increase in demand. However, there are currently no such signals in sight.
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