New Delhi, 21 August (Commoditiescontrol) Soybean futures finished with the steepest weekly fall in two months on the Chicago Board of Trade (CBOT) due to weak demand for soyoil for biofuel and rainfall forecasts for the U.S. Midwest. CBOT soybean futures dropped 5.4% on a weekly basis while soyoil futures plunged 9.99 % on the weekly basis.
Soybean futures continued their fall for the fourth straight session on the CBOT while soyoil futures dropped in all five sessions of the week and the steepest fall of the week was witnessed in the last session on Friday by 5.46 % due to weak demand for biofuels as crude oil prices dropped over 10% after August 12.
Soybean futures fell to a 7-1/2 week low on Friday on concerns about soyoil demand from the biofuels sector and as drought-parched crops in the northwestern U.S. Midwest were due to receive needed rain, said trade analysts.
CBOT November soybean futures dropped to their lowest since June 28 and ended down 29-1/4 cents at $12.90-3/4 per bushel in the last session of the week. The benchmark November futures declined 5.4%, the steepest weekly drop in two months.
CBOT most-active December soyoil dropped by its daily 3.5-cent trading limit on Friday but ended down 3.27 cents at 56.65 cents per pound, 9.99 percent down as compared to last week’s closing. However, December soymeal futures gained $1.30 to settle at $354.90 per short ton.
Commodity funds were net sellers of CBOT corn, soybean, soyoil, and wheat futures contracts on Friday and net buyers of soy meal futures, said a trade analyst.
The U.S. Environmental Protection Agency may recommend lowering biofuel blending mandates below 2020 levels, said a report..But at the same time, EPA is also expected to make a separate recommendation to boost blending mandates for 2022. Recommendation for 2021 is reduced to align mandates with actual levels of production, which have declined during the Covid-19 pandemic season.
It should be noted that soybean and soyoil production in the U.S. is forecast for 2021-22 at 4.34 billion bushels, down 66 million on lower yields and supply of the oilseed (soybean) for 2020/21 are projected at 4.5 billion bushels, down 3 percent from last year.
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