The soy May 2025, at the moment, is below US$290 per ton. As for the reasons behind, it can be seen that the supply that continues to rise, in the context of a stable to slightly downward demand.
It should be noted that the stocks/consumption of USA They rose to almost 11% against 8% in the previous cycle, and were above the 9% historical average.
About this, Brazil projects a harvest that began at 165 M.Tn. and it could go to 170. Argentina, for its part, would be in the range of 52/55 M.Tn.
On the demand side, experts maintain that China would buy less soybeans than last year. While the USDA targets 3 M.Tn less, China believes it would buy 7 M.Tn. less.
From June onwards, when the US election gained ground in the discussion, with the certain possibility of a Trump’s triumph, The market anticipated a possible trade war.
China and other countries accelerated their purchases of soybeans from North America. This led to the pace of North American exports accelerating, putting a floor on prices.
“In the same sense, the low stocks/consumption of oils won the sceneand with increasingly demanding biodiesel policies, palm oil rose sharply. Productive problems in rapeseed and sunflower did the same with quality oils, and since soybeans had been left behind, they were betting that it would have a jump,” he explained. Roman Danteprofessor and researcher at the Center for Agribusiness and Food of the Austral University.
And he concluded: “At the macro level, the declines of the federal reserve weakened the dollar and gave additional support to commodities. To this we must add that the war conflicts had entered a phase of stabilization. “They’re still there, but they didn’t seem to be going anywhere.”
How does this situation affect Argentina?
In Argentina, when soybeans are planted well and have good weather in early development, the belief grows that there will be a good harvest and, although prices were lower, finally many producers began to be convinced that the fundamentals were not with them.
To this we must add that at this time of the year, Sales of soybeans available with May buybacks begin to decline, and “artificial” demand for May soybeans declines. There remain only genuine buyers who are not willing to validate bankruptcy prices for the new cycle.
“To make matters worse, if we think about a minimum margin for soybean crushing during harvest, with this price level we should see prices below US$250/tn,” he explained. Roman Dante.
Source: Ambito
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