Accelerated soybean harvest in Argentina and active supplies from Brazil are putting pressure on prices, including Ukrainian soybeans

Soybean prices continue to decline under pressure from increasing supply from South America. July soybean futures on the Chicago Board of Trade fell by 0.5% over the week to $382/t (still 3.5% higher than a month ago). The main factor behind the decline is the activation of exports from Brazil and the acceleration of the harvest in Argentina, which also limits demand for Ukrainian soybeans from external buyers.

According to Argentina’s National Meteorological Service, the country’s grain belt received 30-50 mm of rain last week, delaying the soybean harvest and creating risks of fungal diseases due to high humidity. According to official figures, only 25% of the area has been harvested as of early May, 9% less than last year. The forecast for dry weather this week could help speed up the harvest.

Argentina recorded its lowest soybean exports in 11 years in April due to uncertainty over the harvest. However, sales activity resumed at the end of the month, with 1.21 million tonnes exported in one week. Despite this, the pace is lagging behind the plan, with only about 26% of the planned 49 million tonnes being sold.

Brazil, on the other hand, continues to increase exports. According to the Ministry of Commerce, soybean exports in April reached 15.271 million tons, 4% more than in March and almost 4% more than in the same period last year.

In Ukraine, export prices for GMO soybeans remain stable — $390–393/t (or UAH 18,000–18,400/t) with delivery to Black Sea ports. Some traders are slightly raising prices to form export batches against the background of an increase in purchase prices by processors. Last week, domestic purchases of GMO soybeans increased by UAH 100–200/t — to UAH 17,600–18,000/t with delivery to the factory. This led to increased offers from farmers.

Prices for non-GMO soybeans remain stable at $425–435/t (UAH 19,800–20,100/t) delivered to ports, while processors are offering UAH 19,000–19,200/t for it.

Soybean futures in Chicago are supported by expectations of the results of a meeting between the US Treasury Secretary and China’s vice premier in Switzerland. The talks are about trade and customs issues, but it is unlikely that the first official meeting of the parties will lead to a breakthrough in the multi-year trade war that began under President Trump.

Tags: prices, soybean, Ukraine