Fundamentally Speaking

The soybean market has been on quite a run over the past five weeks, rallying over $1 per bushel and nearing middle-of-November highs. Support has come from 2 1/2-year high prices in soybean oil on ideas that the EPA decision on RVOs will be friendly to the biodiesel sector and hopes of additional purchases of U.S. soybeans by China. So far there is no indication China has purchased any more U.S. soybeans beyond the 12 million metric tons (mmt) they had agreed to, though that may change after President Trump visits China in April.

Nonetheless, sales of U.S. soybeans continue to lag. However, in this month's WASDE update, USDA kept its 2025-26 export projection for soybeans at 1.575 billion bushels (bb). The accompanying chart shows U.S. soybean sales and shipments as of the second week of February as a percent of USDA's February WASDE export projection with those sales as a percent of the final figure plotted on the left-hand axis. On the right-hand axis is the percent change in U.S. soybean exports from the February WASDE projection to the final estimate.

Current sales, as of last week's export sales report, are 1.300 bb, below the 1.60 bb of a year ago and the second lowest for this point in the marketing year since the 2012-13 season. This is 82.5% of the latest WASDE estimate and down 18.7% from the year ago level when USDA is looking for just a 16.3% decline.

Meanwhile just 895 million bushels (mb) have shipped, the second lowest total since the 2011-12 season and down 32% from the year-ago level. This is only 56.8% of the 1.575 bb WASDE projection which, other than the 2018-19 season, is the lowest percent going all the way back to 2000. Just looking at the figures, this could suggest perhaps USDA is a tad too high with their export projection. Right now, everything is up in the air, though new-crop Brazilian soybeans are far cheaper, politics may "trump" that consideration going forward.

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