Soybeans Pressured at 4-Month Lows

Soybean futures traded below $11.2 per bushel, hovering near four-month lows as a tentative US-Iran peace agreement sent oil prices sharply lower. Oil prices dropped after US President Donald Trump and Iran’s deputy foreign minister said they had reached a tentative deal to halt hostilities and resume traffic through the Strait of Hormuz. Agricultural goods often track crude oil prices due to their link to biofuel demand from grains and oilseeds. Favourable US crop weather and higher South American production forecasts added pressure on prices, with the USDA last week raising its soybean production forecasts for Argentina to 50 million metric tons. Weak Chinese demand for US agricultural exports has further weighed on sentiment despite earlier expectations of large-scale purchases. Meanwhile, US soybean crush pace likely slowed for a third straight month in May as some processing plants were idled for seasonal maintenance and repairs despite historically large crush margins.

Soybean futures traded around $11.1 per bushel, hovering near four-month lows, pressured by favorable US crop weather and a lack of renewed Chinese demand for US supplies. The absence of visible Chinese buying activity has disappointed traders who had anticipated stronger export demand following the announcement in May that China would buy $17 billion worth of US agricultural products annually in addition to the 25 million metric tons of soybeans already committed. Meanwhile, favorable weather across the US Midwest continued to reinforce expectations for strong crop development, while the likelihood of a sharp increase in planted acreage raised prospects for a record harvest. USDA's weekly crop ratings are expected to show improvement from the prior week's 66% good-to-excellent rating, while planting progress reached 87% complete as of May 31. Elsewhere, Argentina's soybean harvest was 91.7% complete, while soaring fertilizer costs are pressuring Brazilian farmers.

Soybean futures slid around $11.2 per bushel, hitting a four-month low as favorable US growing conditions and strong planting progress reinforced expectations of ample supply. Improving weather across key US regions supported crop development, while recent rainfall eased drought concerns in parts of the Plains and reduced earlier planting-delay worries in the Midwest. USDA also reported planting at 87% complete as of late May, ahead of the five-year average, with emergence above normal at 65%. Meanwhile, crop condition ratings came in slightly below expectations at 66% good-to-excellent, reflecting mixed regional performance. Export outlook remains weak, with US soybean shipments expected to decline about 344 million from fiscal 2025 as China continues to be a key but inconsistent buyer. US exporters have been disappointed that no sizeable new corn purchases from China have been reported so far, despite political signals in mid-May that suggested larger Chinese agricultural imports.