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In the week ending 9th July, 51% of the US soybean crop were rated to be in good-to-excellent condition, up 1% from the previous week as highlighted in the latest USDA Crop Progress report, albeit falling 1 percentage point (p.p) short of the average trade estimate and down 11 p.p compared to the same period last year. The slight recovery in crop conditions is attributable to favourable weather conditions in the past week across the Midwest. Significant recoveries were noted in Illinois (+6 p.p), Louisiana (+8 p.p) and Nebraska (+12 p.p).
Despite the improvement in total US soybean crop conditions, the CBOT soybean futures price (Jul-23) settled at USc 1,508/60 lbs bushel, up 1.5% on the day, following the release of the report on 10th July. Similarly, the CBOT soybean oil futures price also climbed by 4.0% on the day, settling at USc 69.22/lbs. The price increases are due to anticipation of this month’s WASDE report due to be released tomorrow, Wednesday 12th July (12:15 pm ET) where the market expects four million acres cut for soybean production in line with the reduction in planted area as reported by Mintec here. Currently, weather conditions seem favourable for the coming week, as stated by market sources. Nonetheless, weather patterns will remain a significant watch-point for crop progress.
Also contributing to the price increases has been higher soybean demand from China – a major importer. According to market sources, as of 7th July, total soybean stocks at China’s ports were up 0.63% on the week to 896,800 mt.
