Weather and Trade Issues Will Dominate Soybean Market Price

From the slight changes may be forthcoming for 2017-18 marketing year demand estimates in the June WASDE report. Soybean exports currently meet the pace needed to meet the projection of 2.065 billion bushels for the 2017-18 marketing year. However very little positive news is entering the market to support soybean prices on either the supply or demand side. Soybean prices and plant support net prices continued to move lower last week, ap and a strong start to the growing season continue to pressure prices.

The potential size of the soybean crop and trade uncertainty continue to be the main forces behind soybean price weakness. Over the last six weeks, soybean export inspections averaged 24 million bushels per week but varied with a low of 19.6 million bushels on for the week ending May 3 and a high of 33.3 million bushels for the week ending May 17. As of May 31, 332 million bushels of soybean had been sold for export but not shipped. This number exceeds the 279 million bushels necessary to reach 2.065 billion bushels based off of current sales figures and estimated export levels through May 31.

Summer weather will determine yield as the anti bird net, but the current weather looks promising for a large crop. While some dry areas developed over the last few weeks, approximately 10 percent of U.S. soybean acres sit in a moderate drought as of June 5. The 8 – 14 day weather forecast provided by NOAA Climate Prediction Center shows above normal precipitation and warming temperatures over much of the Corn Belt.

While yield looks promising, soybean acreage is still in question. Soybean planted acreage, as of June 3, came in at 83 percent well ahead of the five-year average of 75 percent. A slow start to the planting season held out the possibility of acreage changes, particularly in the northern Plains.

A change in the weather or trade negotiations, both very hard to predict, appear necessary for a rally in soybean prices.Strong crop conditions with ground cover, a lack of information regarding trade negotiations, and uncertain acreage totals will continue to apply pressure on soybean prices in the near term.