The oilseed markets fell noticeably this week - the soy complex in particular came under heavy pressure. Despite isolated impulses from the political and fundamental side, the stock markets lacked support. In addition, favorable weather conditions in the USA depressed sentiment. On the CBoT, the price for August soybeans last stood at 1027.75 US cents/bushel.
The start of the week was dominated by geopolitical tensions in the Middle East conflict and the resulting sharp rise in oil prices. However, once the situation had calmed down and oil prices slipped, oilseeds also began to slide. Even the recent good export prospects for soybeans were unable to counteract this decline.
As the week progressed, the pressure intensified and the focus shifted more strongly to the USA as a growing country: with crop development estimated to be stable, expectations of a good harvest grew. Traders were increasingly skeptical as to whether there could be any bullish impetus for the price in the short term. Added to this was the weather outlook: US growing regions are currently experiencing almost ideal conditions. Warm temperatures and regular rainfall are fueling expectations of strong harvests.
A surprising ray of hope came from Brazil: the government announced an increase in blending quotas for biofuels. And China also bought soybean meal from Argentina on a trial basis in order to reduce its overall dependence on the USA and expand its trading network accordingly. However, even these price-supporting factors were unable to counteract the general downward trend.
On Euronext in Paris, the pressure from the fall in crude oil prices for rapeseed also continued over the course of the week. Canola futures also fell significantly in Canada. In addition to the strengthening of the Canadian currency, the upcoming quarterly report also weighed on the price.
ZMP Live Expert Opinion
The oilseed market is currently showing a weak trend, with soybean prices in particular falling continuously since the beginning of the week. Expectations regarding US weather and harvest conditions remain relaxed, which is increasing price pressure. Despite positive export figures for the new season, the momentum for a sustained recovery is still lacking, while the weak soybean meal market is an additional burden. Overall, there are no signs of a rapid recovery for oilseeds in the short term until new impetus comes from export news or changes in the weather, for example. However, if the conflict over Iran flares up again, a countermovement could quickly develop.
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