Front-month soybean futures on the Chicago Mercantile Exchange returned to positive territory on Friday May 24 on the back of soymeal’s surge and crude oil’s gains.
The front-month July soybean futures contract on the CME gained 8 cents per bushel to $12.72 per bu at the time of publication.
The soymeal July futures contract rose by 2.1% from the previous settlement, supporting soybean futures along with crude oil prices, which gained 1.1% on the day, and a lower US Dollar Index.
The soymeal uptrend was supported by recent high wheat prices, leading to increased demand for soymeal as a cheaper option as well.
Market participants are also adjusting positions ahead of the Memorial Day holiday in the US on May 27, which will delay the USDA’s weekly planting progress update to May 28.
Rain has returned to the Brazilian state of Rio Grande do Sul on Thursday May 23, raising concerns about soybean crops and storage units.
In other news, the excess rain and soil humidity hindered the advance of soybean harvest in Rio Grande do Sul, according to a report by state agency Emater/RS on Thursday.
Harvest advanced by six percentage points on the week to 91% of the 6.68 million hectare sowed area, below the 96% completion rate from a year earlier and the 97% five-year average rate.
In Argentina, soybean harvest advanced by 14.2 percentage points to 77.9% of the projected 17.3 million hectares in the week to Wednesday May 22, the Buenos Aires Grains Exchange (BAGE) said in its weekly crop report update on Thursday.
At origin, Brazilian FOB premiums in the Paranaguá paper market for July loading fell by 3 cents per bu on Friday and were assessed at 33 cents per bu over the July CME futures contract.
The July-loading contract on the FOB Argentina market remained unchanged, assessed at a premium of 22 cents per bu over the July CME futures contract.
Despite a lack of export demand, premiums in the US CIF barge market remained firm.
July was offered at a premium of 59-60 cents per bu over CME July soybean futures, while August was bid at a premium of 55-58 cents per bu to the August contract, against offers at 64 cents per bu.
FOB premiums were stable in the US both at the FOB Gulf and Pacific Northwest hubs.
In China — the world’s main destination market — soyoil and soymeal futures declined on the Dalian Commodity Exchange on Friday.
The July soyoil contract lost 0.45% day on day to 7,882 yuan ($1,088) per tonne, while the equivalent soymeal contract shed 1.22% to 3,474 yuan per tonne.
This week, soymeal sales in China were said to have reached 549,800-555,300 tonnes in total, compared with around 556,500 tonnes sold the previous week. In general, soymeal sales in China were said to be sluggish with mostly spot sales.
In the physical market, China was said to have bought June-July Brazilian cargoes at a premium of 151 cents per bu, June Brazilian cargoes overnight at premiums of 150-153 cents per bu and July Brazilian cargoes at a premium of 160 cents per bu, all over July CME futures.
China was also said to have bought two to four cargoes of Argentine soybeans this week, with levels heard at a $1.65-1.70 per bu over July futures.
CFR premiums for Brazil were stable on Friday, with premiums for July offers heard at 165-175 cents per bu and for August offers at 184-190 cents per bu, all over July futures.
The Agricensus APM-6 China Soybean Marker for July shipment of the cheapest option was assessed 4 cents per bu lower at 160 cents per bu over July futures, equivalent to $513.75 per tonne on an outright basis.