Following the USDA report, the value of soybeans jumped in Chicago and reached the highest since March 2018

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Following the USDA report, the value of soybeans jumped in Chicago and reached the highest since March 2018


A few days before a new soybean campaign begins, which is estimated at more than 18 million tons, the good news comes from the United States.

It is that the price of the oilseed hit a significant jump throughout the week and mainly at the end of the week after a new report from the United States Department of Agriculture (USDA, for its acronym in English). Thus, in the 5 days of the week the crop was up $ 16.5 per tonne, almost 5%.

At the beginning of the week, soybeans traded at $ 375 and on Friday reached $ 391.5 per ton, the highest since March 3, 2018, prior to the Trade War between the United States and China.

The closest position, November 2020, rose 5.7 dollars and closed at 391.5 dollars while the position of January 2021 rose 6.4 dollars and reached the same value.


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© clarin.com
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While this increase in Chicago also rebounded in domestic markets. 24,480 pesos were paid for available soy, 280 pesos more than this Thursday.

In the futures markets, the Matba Rofex rose 4 dollars reaching 316 dollars for the October Position and almost 5 dollars for the November Position, reaching 319 dollars per ton.

These widespread increases for soybeans both in the Chicago market and in the local market is due to the fact that the United States Department of Agriculture gave the estimates for October and brought surprises for soybeans.

“Once again, the USDA underpinned the fundamentals in the soybean market, both on the supply side and on the demand side. Although something was already expected, having been recently incorporated into prices, there was also a surprise, when realizing of a tighter scenario for the US, “he began by explaining Ariel tejera, Grain analyst at Grassi brokerage.

On the one hand, the international organization incorporated a lower carry over from the 2019/20 campaign to the 2020/21. And on the other hand, it adjusted production to 116.1 million tons in the United States, representing a cut of 1.2 million tons compared to the previous monthly report. And at the same time, the projection of foreign demand for the North American country increased by 2 million tons.

According to Tejera, the result was a severe cut in the 2020/21 end stock estimate, that is, the remainder, to 7.9 million tons. Thus, 4.6 million tons were located below the September estimate. “This generated surprise with an instant impact on prices. With the new scenario, the stock / consumption ratio, a key indicator that the market follows, fell to 6.4%, the lowest value since the 2015/16 season,” he said.

Another point no less, he argued, was a further increase in the estimate of China’s total imports for the 2020/21 cycle. The USDA confirmed the appetite of the Asian giant, raising the number to 100 million tons, a historical record.

This rise for soybeans occurs after the temporary reduction in withholdings for soybeans and derivatives from October for three months and then in January to pay 33% again, except for the by-products of the oilseed complex that go back to 31 %.

“In the last two days, between Wednesday the 7th and Thursday the 8th, the agriculture liquidated 554 million dollars,” said the Minister of Agriculture, Luis Basterra, referring to the fact that the official measures have been effective.

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