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Soybean complex continues to remain under pressure on U.S. harvest

3 Oct 2022 8:04 am
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Mumbai, October 3 (Commoditiescontrol) CBOT soybean complex is expected to remain under pressure this week on U.S. harvest and faster pace of sowing in Brazil.

Soybean futures at the Chicago Board of Trade (CBOT) witnessed a steep fall last week after which recovery may be seen in the beginning of the week but later pressure may be seen due to increasing pace of U.S. harvest and sowing in Brazil.

The most active contract of soybean saw a fall by 4.24% last week on the CBOT while soymeal contract dropped 4.27% at the U.S. exchange. Soyoil prices dropped 3.44% on the CBOT last week.

CBOT November soybeans settled 46 cents lower at $13.64-3/4 per bushel on Friday.

CBOT December soymeal ended 4.2 lower at $403.00 per short ton while December soyoil fell 2.30 cents to finish at 61.56 cents per lb in the last session.

The U.S. Department of Agriculture increased its assessment of U.S. soybean stockpiles, to 273.76 million bushels, above trade expectations of 242 million bushels.

The volume of soybeans crushed by U.S. processing plants likely dropped to 5.263 million short tons in August, or 175.4 million bushels, according to the average forecast market analysts, ahead of a monthly USDA report due Monday.

Weekly CFTC data showed soybean spec traders were closing longs through the week of 9/27. That long liquidation left the group 9,860 contracts less net long to 94,831 contracts – a 10-wk low. Commercial soybean traders were adding long hedges via 12.3k contract for a reduced net short to 116,394 contracts – a 49 week low.

In soybean meal, the spec funds were 8,623 contracts less net long for a 93,545 contract net long. Managed money was shown 58,417 contract net long in soybean oil as of 9/27, a 107 contract stronger net long through the week.

NASS data showed September soybean stocks were 274 mbu carried into the 22/23 season. That compares to the average trade guess of 242 and last season’s 256.979 mbu. 2021/22’s final quarter usage was implied at 698 mbu, compared to the 512 mbu finish to last year. USDA revised the 21/22 production number to 4.465 bbu, which was up by 30 mbu from their prior figure.

China announced a plan to reduce port cargo fees by 20% for the Q4 of 2022.

Brazilian farmers are sowing soybeans at a faster pace this season, according to estimates from two agribusiness consultancies on Monday.

They cited significant advances in the state of Parana and progress in the pace of sowing in the state of Mato Grosso, the largest producer of soybeans in Brazil, as driving the trend.

Safras & Mercado estimated 2% of the national soybean area has been planted so far for the 2022/2023 cycle, more than twice as much as last year's 0.8% of the area and above the historical average of 0.8% for this point in the season.

As per Consultancy AgRural estimates, farmers had planted 1.5% of the soybean area in Brazil, compared with 1.3% for the same period last year.

According to Safras, Parana soy farmers had planted 9% of the expected area by Sept. 23 while Mato Grosso and the states of Mato Grosso do Sul and Sao Paulo each had planted 2% of fields.

Brazilian soybean growers are expected to plant the oilseed on 42.88 million hectares (105.9 million acres), the biggest acreage in history and a 2.6% increase from last year.

Brazil's government estimates national output will be 150 million tonnes this season, which would be a record.

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