Soybeans Steady After Sharp Rally

Soybean futures held above $12.1 per bushel, after climbing 3.4% in the previous session to rebound from multi-month lows, as the US Department of Agriculture (USDA) tightened its US supply outlook by cutting production and inventory forecasts more than expected. The agency’s US soybean production estimate came in 23 million bushels below the average analyst forecast, while its projection for domestic and export demand prompted a 15-million-bushel reduction in expected end-of-season stocks, against market expectations for an increase. Meanwhile, the USDA maintained its South American soybean production outlook. However, gains were partly tempered by weaker demand signals from China, where October soybean imports fell to their lowest monthly level since 2023 amid high crusher inventories, negative margins and low pork prices. Still, China’s agriculture ministry raised its 2025/26 soybean import estimate, leaving its 2026/27 forecast unchanged.

Soybean futures surged 3% above $12 a bushel, recovering from three-month lows and tracking gains across grain markets after the latest WASDE report. The USDA raised its estimate of US soybean production to 4.574 billion bushels, with a record average yield of 53.3 bushels per acre, up from its October forecast of 4.562 billion bushels and 53.1 bushels per acre. In contrast, the agency cut its corn production estimate to 15.893 billion bushels, below both its previous forecast and analysts’ expectations, citing a lower projected yield. As of November 8, the US soybean harvest was 92% complete and corn harvesting had reached 81%. Expectations of large crops in Brazil could limit further gains, although renewed optimism over Chinese demand provided support. Beijing has pledged to purchase 25 million metric tons of US soybeans annually for three years, alongside additional agricultural products, raising hopes for stronger exports ahead of a possible Trump-Xi meeting later this month.

Soybean futures traded around $11.8 per bushel, near their lowest level since mid-August as traders positioned ahead of the USDA's November WASDE report. The report is expected to provide fresh estimates for US soybean production and ending stocks, with prospects for a large domestic crop keeping supply concerns in focus. The US soybean harvest reached 92% completion as of November 8, one percentage point ahead of the five-year average, keeping seasonal supplies flowing into the market. Meanwhile, renewed hopes for stronger Chinese purchases provided some support following last week's call between US and Chinese trade officials, during which Washington urged Beijing to honor its agricultural purchasing commitments. China pledged to buy 25 million metric tons of US soybeans annually for three years, alongside an additional $17 billion in US agricultural products each year through 2028. The talks raised hopes for increased purchases ahead of a possible Trump-Xi meeting later this month.