Global oilseed market: Soybean supply outlook remains tight, oilseed prices are rising

 

On Friday, the Chicago Board of Trade (CBOT) November soybean futures rose by about 129.
25 cents, or 10.
18%, to close at 1399 cents per cat
.
The average spot price of Meiwan No.
1 yellow soybeans was 15.
1375 US dollars per cat (556.
2 US dollars per ton), an increase of 117.
5 cents or 8.
42% from a week ago
.
The Euronext exchange's November 2021 rapeseed futures closed at approximately 535 euros/ton, an increase of 30.
75 euros or 6.
10% from a week ago
.
The intercontinental exchange (ICE) November rapeseed futures rose by about 91.
4 Canadian dollars, or 12.
36%, to close at 830.
9 Canadian dollars/ton; the FOB spot price of Argentina’s Shanghe soybeans was 533 US dollars (including 33% export tax), up 41 from a week ago USD or 8.
33%
.
The Shanghe spot price of Argentine soybean meal was US$420.
4/ton per ton, up US$33.
45 or 8.
64% from a week ago
.
The Dalian Commodity Exchange reported that soybeans closed at 5,727 yuan/ton in September, up 102 yuan or 1.
8% from a week ago
.

 

　　On Friday, the US dollar index closed at 92.
24 points, up 0.
5% from a week ago
.

 

　　The weekly crop progress report released by the US Department of Agriculture on Monday showed that as of June 27, the emergence rate of soybeans in the United States was 96%, 91% last week, 94% the same period last year, and 92% in the past five years
.
The excellent and good rate of soybeans was 60%, the same as a week ago and lower than 71% in the same period last year
.
Following last week’s rains, the weather in most parts of the Midwestern United States was sunny and dry this week
.
According to the weather forecast released by WeatherRisk.
com, there will be no serious high temperature threat in the Great Plains and the Midwest this weekend, and there will be no rainfall
.
However, there may be rain in the western corn growing belt from Monday to Tuesday
.
Weather models show that 60% of Iowa, North Dakota, and South Dakota will see 1 to 2 inches of rain
.

 

　　The US Department of Agriculture's sown area data report shows that the US soybean sown area this year is expected to be 87.
55 million acres, which is lower than analysts' forecast of 88.
955 million acres
.
The U.
S.
Department of Agriculture also expects soybean stocks as of June 1 to be 767 million cats, which will be the lowest level in six years, and analysts forecast 787 million cats
.
The US Department of Agriculture's planting area and inventory data were lower than expected, which intensified market concerns about the soybean supply prospects, especially in the case of bad weather conditions in the agricultural production areas of North and South America
.
Taking into account the tight inventory, the market needs a bumper harvest of US soybeans to ease the tight supply situation in the market, but the situation seems to be counterproductive
.
The violent volatility of soybean market in 2021 will become the new normal, as the supply of the old season is tight, and the weather that affects the outlook for new crop production is uncertain
.

 

　　The US Department of Agriculture’s weekly export sales report shows that for the week ending June 24, 2021, US soybean net sales for 2020/21 were 92,800 tons, 35% lower than last week, but 62% higher than the four-week average
.
The net sales volume in 2021/22 was 1,670,100 tons
.
This brings the total soybean sales to 1.
763 million tons, the highest level since January 21, and is also close to the upper end of the market's expected range
.
So far in 2020/21, the total US soybean export sales have reached 61.
84 million tons, an increase of 38% over the same period last year
.

 

　　The ruling of the U.
S.
Supreme Court last week made it easier for small US refineries to obtain biofuel blending exemptions, which once caused the price of soybeans and soybean oil to plummet, because it meant that the demand for mandatory blending of biofuels decreased
.
However, this week some analysts believe that the number of exemptions from US biofuel blending obligations may be limited
.
U.
S.
biofuel and corn industry organizations urge the U.
S.
Environmental Protection Agency (EPA) to avoid this blending obligation as much as possible
.
Under the Renewable Fuel Standards Act, US refineries must blend billions of gallons of biofuels (such as corn ethanol) into fuels each year, or purchase tradable credits (RIN) from companies that do so
.
If a small refinery can prove that compliance with the regulations will cause economic losses, it can apply for an exemption from the EPA
.

 

　　The sown area report released by Statistics Canada shows that the sown area of ​​rapeseed in Canada in 2021 will be increased by nearly 1 million acres to 22.
479 million acres.
This data is basically in line with market expectations, an increase of 1.
696 million acres or 8.
2% over the previous year.
The highest level in three years
.
Although the sown area data has been revised upwards, rapeseed prices remained strong on the day the data was released.
Among them, the November period, which represents the new season of rapeseed, has further strengthened, with an increase of 50 Canadian dollars, as the continuous drought may damage the yield of rapeseed.
Potential
.
Although some rainfall occurred in most parts of the prairie during May, the soil moisture has been below normal, which continues to be worrying
.
The Commodity Weather Group (CWG) predicts that 75% of the prairie area will receive less than half of the normal rainfall in the next two weeks
.
Analysts said that if the heat wave continues until mid-July, Canadian wheat and rapeseed yields may be reduced by 20%, similar to the level in 2002
.