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Soybean prices stagnant as trade negotiations continue

Article cover photo
Landus Cooperative workers in Ida Grove move a large soybean pile leftover from the 2018 harvest. Today’s USDA report showed ending soybean stocks projected at 900 million bushels. (Photo: Joseph L. Murphy/Iowa Soybean Association)

By Bethany Baratta, ISA senior writer

Today’s U.S. Department of Agriculture’s (USDA) outlook on soybean supplies showed no surprises to the grain trade.

In its World Agricultural Supply and Demand Estimates (WASDE) report released earlier today, the USDA raised soybean crush and projected U.S. ending soybean stocks lower.

The following are soybean highlights from the report:

  • U.S. crush raised 10 million bushels to 2.1 billion.
  • U.S. exports were left unchanged from last month’s report at 1.87 billion bushels.
  • U.S. ending stocks are projected at 900 million bushels, down 10 million bushels from the February report.
  • Argentine production forecast at 55 million metric tons (mmt), unchanged from last month.
  • Brazilian production lowered 500,000 mt to 116.5 mmt.
  • Global ending stocks are projected at 107.17 mmt, up from 106.7 mmt in the February WASDE report.
  • The season-average U.S. price is pegged at $8.10 to $9.10 per bushel, unchanged at the midpoint.

May futures contracts were priced at $8.95 at the close of the market today, down 7 cents from Thursday.

Cory Bratland, chief grain strategist and commodity broker for Kluis Commodity Advisors, said a trade deal with China could help find a home for large soybean, corn and wheat supplies.

“A trade deal with China would be beneficial to chew up some carryout of corn and soybeans,” he said. “But we’re not going to run out of either in the next six or nine months.”

Iowa Soybean Association (ISA) President Lindsay Greiner said the report didn’t show any surprises as traders and farmers await a resolution to trade disputes with key customers.

“Good news on the trade front would provide a chance to sell more old-crop soybeans and get some support for new-crop beans as well,” said the Keota farmer.

The year could turn out rosier than projected if trade deals are secured, said Grant Kimberley, ISA director of market development.

“If there’s a trade resolution that’s meaningful and significant that grows our export markets, then the future looks a lot better,” he said.

Kimberley said ISA will continue to work with the American Soybean Association and U.S. Soybean Export Council to build relationships with other countries to get a foothold in their markets. He’s hopeful that a trade mission to China, slated for the end of this month, will help.

“We will be rekindling that relationship with key buyers to gauge where their demand might be for the rest of the year and for next year,” Kimberley added. “This will hopefully set the stage for additional purchases once this trade deal is finalized.”

Bratland said the March 29 grain stocks and prospective plantings report could provide better insight on this year’s crop. Weather will play a large role in planting and growing progress.

“We have created a large demand for corn, soybeans and wheat across the world. We have the genetics to grow a big crop, but what happens if we have a repeat of 2012?,” he asked. “We have had four borderline record productions in a row — we’re about due for a hiccup here.”

Bratland said farmers should be “willing to see the rallies,” and look for nearby soybean prices at $9.20 per bushel or better on the futures to sell old-crop soybeans. Farmers should look at prices at $9.60 or better as a trigger to protect new-crop soybean sales.

Contact Bethany Baratta at bbaratta@iasoybeans.com

For media inquiries, please contact Katie Johnson, ISA Public Relations Manager at kjohnson@iasoybeans.com or Aaron Putze, ISA Communications Director at aputze@iasoybeans.com

For permission to republish articles or to request high-res photos contact Aaron Putze at aputze@iasoybeans.com. Iowa Soybean Association | 1255 SW Prairie Trail Pkwy | Ankeny | IA | 50023 | US

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