Soybean prices in Ukraine are falling amid declining export demand

Increased precipitation and improved conditions for soybean planting in Brazil predictably increased pressure on world prices, which could not be supported even by a sharp decline in the forecast of soybean crop in the United States. Increasing soybean supplies from South America to the EU and Pakistan’s permission to import GMO soybeans has collapsed the demand for soybeans in Ukraine.

According to Conab, in Brazil, as of November 10, soybeans were planted on 66% of the planned area (57.3% last year), and favorable precipitation improves conditions for the development of crops. The optimal sowing dates are not yet over, so the planting areas may increase, which will allow to obtain in MY 2024/25 a record 169 million tons of soybeans.

In October, Brazil reduced the export of soybeans compared to September from 6.1 to 4.71 million tons, which is 15.9% less than exported in October 2023 5.6 million tons. At the same time, exports of soybean meal increased to 2.3 mln tonnes (up 24.4% compared to October 2023), the highest level in October and the third highest monthly figure since 1997.

Argentina is also starting to plant soybeans, and recent rains have created favorable conditions for planting.

November soybean futures on the Chicago stock exchange yesterday fell 1.2% to 371 $/t, losing 2% after the release of the bullish USDA report, where the forecast of soybean crop in the United States was reduced from 124.7 to 121.4 million tons.

Markets remain under pressure from low demand from China and its possible refusal to buy U.S. soybeans, if Trump again starts a trade war.

In Ukraine, the purchase price of soybeans with GMOs in the ports decreased during the week by 200-300 UAH/t to 18000-18200 UAH/t or 370-385 $/t due to the reduction of companies that bought soybeans. This allowed processors to lower prices by 200-300 UAH/t to 17700-18000 UAH/t with delivery to the plant.

The market is already overstocked with soybean meal, so the mills will reduce the volume of soybean processing, especially given the increase in sunseed supply from farmers amid rising prices.

Export purchase price of non-GMO soybeans in the ports of the black sea fell by 20-30% to 405-430 $/t or 19000-20000 UAH/t (although at the beginning of the season the premium for this soybean reached 65-80 $/t), but processors refrain from purchases in anticipation of further price declines.

The Pakistani authorities allowed the import of GMO soybeans from the United States, bypassing the mandatory risk assessment required by the Cartagena Protocol on Biosafety. The National Biosafety Committee (NBC) issued import licenses to 42 importers for food, feed and processing of soybeans containing 47 genetic elements.

This decision has brought down demand prices for non-GMO soybeans in Ukraine by $30-40/t, so now we can only hope for a recovery in demand from China, which also pays a premium for non-GMO soybeans.

Tags: prices, soybean, Ukraine