Lower soybean price due to expected record harvests

The US expects soybean production of 122.7 million tons this season. Photo: Canva
The US expects soybean production of 122.7 million tons this season. Photo: Canva

A record crop of soybeans is expected in the US. The eyes of the oilseed market are therefore focused on sowing activities there.

Planting is going well in the US, and as of 14 May, 49% of US soybean acreage was sown. The 5-year average is 36% on the same reference date. According to the US Department of Agriculture (USDA), America expects soybean production of 122.7 million tonnes this season. For comparison, in 2022-23 and 2021-22, 116.4 million tonnes and 121.5 million tonnes of soybeans were harvested, respectively.

Continued price pressure

Price pressure on soybeans will continue due to good plantings and expected record harvests. Brazil has also brought in a record harvest of soybeans, which means that global production for 2023-24 is higher than the previous season. According to the USDA’s latest WASDE report, global oilseed production stands at 671.2 million tonnes. This is mainly due to increased production in Brazil, Argentina and the US.

Global oil seed trade

The global trade in oilseeds is expected to be slightly less vibrant in 2023-24. Although the export of soybeans is increasing, it is compensated by less trade of rapeseed and sunflower seed. Exports are declining because major importing countries are producing more themselves. On the other hand, large exporters expect lower rapeseed production.

A record sunflower seed harvest of 11.5 million tonnes is assumed for Europe. That is 2.2 million tonnes more than was produced last season (2022-23). The rapeseed crop is also growing well in Europe. Significant EU production is expected. In addition, Canada expects to harvest more rapeseed.

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