Strong demand offsets price pressure from record global soybean crop

Global soybean production could reach a record 442.25 mln tons in 2026/27, up 12.79 mln tons from the previous season. Almost all of the increase is expected to come from the US and Brazil, with US production rising by nearly 7 mln tons and Brazil’s crop by 5.5 mln tons. However, the substantial increase in supply has so far failed to push prices lower due to strong demand for soybeans and soybean products.

Despite the record crop forecast, Chicago soybean futures rallied significantly in mid-August. The November contract climbed from below $11.50/bushel on August 11 to $12.22/bushel on August 19. Strong crush rates and active exports are supporting the market. USDA expects US domestic soybean use to increase by 122 mln bushels in 2026/27, while exports are projected to rise by 140 mln bushels.

China remains one of the key demand drivers. As of August 21, Chinese buyers had already booked 6.558 mln tons of new-crop US soybeans, equivalent to 24% of their 2026 commitment. Another 4.69 mln tons of new-crop US soybeans were sold to unknown destinations.

Rising use of soybean oil for biodiesel production in the US is providing additional support to the market. USDA projects domestic soybean oil consumption to increase by 2.8 bln pounds in 2026/27. Higher crude oil prices in August also supported soybean oil prices and, in turn, the broader soybean market. Meanwhile, US soybean meal exports are forecast to increase by almost 2 mln tons.

Uncertainty also surrounds Brazil’s upcoming soybean crop, with planting set to begin in September. USDA expects production to increase further, while Rabobank forecasts a 2% decline to 178 mln tons. A strong El Niño poses an additional risk, potentially bringing excessive rainfall to southern Brazil and dry conditions to northern growing regions.

Tags: prices, soybean, crop forecast