SOYBEANS DELAY RALLY FOLLOWING USDA`S BULLISH WASDE REPORT

The crop’s prices have raised their profits from 2020, rising almost 8% in the first two weeks of the year. But as prices trade at their most favorable levels in 2021, how much greater can soybean go over the next 12 months? 

March soybean futures fell $0.0875, or 0.62%, to $14.095 per bushel at 14:16 GMT on Wednesday on the Chicago Board of Trade (CBoT). Soybean prices have climbed to their highest point after February 2014, enjoying a roaring 52% rally over the last 12 months.

On Tuesday, the US Department of Agriculture (USDA) published its first World Agriculture Supply and Demand (WASDE) report of 2021. The USDA stated that soybean production is calculated to drop 35 million bushels to 4.1 billion bushels. The harvested area is higher to 82.3 million acres, while the yield is predicted to slip 0.5 bushels to 50.2 bushels per acre.

The US government perceived that soybean supplies are under 14 million bushels from December, with the season-average soybean price for the 2020–2021 marketing season is current 60 cents to $11.15 per bushel. Soybean export estimates were increased by 30 million to an all-time high of 2.23 billion bushels.

Amid the agricultural commodities, corn production was reviewed downward by 324 million bushels to 14.1 billion bushels, with a season-average price of $4.20 per bushel.

Overall, the US government expects that soybean and corn supplies in September will be less than beforehand foretold because of a decreased forecast of last autumn’s harvest.

The WASDE report looked past the borders of the US, highlighting the events happening in South America. Argentina and Brazil, two significant markets for soybean production, have been struck by dry and hot weather conditions, affecting their harvest. The USDA updated its expectations for production and stocks more economical for Rio de Janeiro and Buenos Aires.

As stated in data from the Commodity Futures Trading Commission (CFTC), non-commercial traders, including hedge funds, decreased their net-long positions in soybeans. This probably signals that the market is anticipating a pullback in soybean prices.

In other crop markets, March corn futures totaled $0.1225, or 2.37%, to $5.295 per pound. March wheat futures slid $0.02, or 0.3%, to $6.63 a bushel. March coffee grew from $0.0285, or 2.35%, to $1.242 per pound.