The soybean listing on the futures market in Chicago reached its all-time high in nearly three months late last week.
This week, the quotations of the July and September contracts are taking a step back. These are currently the most widely traded soy contracts in Chicago.
The weather forecast is good in the major soy regions in the United States. In addition, the soy crops look good. The United States Department of Agriculture (USDA) ranks 70% of all soybean plots in the good or excellent category. That was 53% last year.
Good weather prospects to give a better chance of a good soy harvest. This is pushing soy markings down in Chicago, despite the continued demand for soybeans from China. After the meeting between US Secretary of State Mike Pompeo and China’s top diplomat Yang Jiechi in Hawaii, traders are hoping that demand from China will continue.
This can also be seen on the world market. The International Grains Council (IGC) price index for soybeans has been above 180 points for four days. That is the highest level in five months.
Overview of futures prices for: corn, wheat and soybean
China is the hub of the soy market. The USDA expects China to import 96 million tons of soybeans in the new 2020-2021 season. That is the second highest import ever. Nearly a third of all soybeans grown in the world go to China. Almost two thirds of world trade is focused on China.
This week the forecast is: The market is stable