Drought in Argentina and heavy rainfall in Brazil led to a speculative increase in soybean prices by 3.2%

The weekend brought heavy rains to central and northern Argentina, but the southwest received less rain than expected. Despite this, the cyclone brought down high temperatures somewhat. Forecasts for the coming week do not predict any rain, with temperatures ranging from 22 to 32 °C, which will negatively affect soybean and corn crops.

In central Brazil, prolonged rains are delaying the harvest of early soybean varieties. According to Conab, only 1.2% of the 47.4 million hectares of crops have been threshed so far, compared to 6% last year. According to forecasts, the rains will not stop in the next 7-10 days.

Photos of sprouting soybeans in Brazilian fields have sparked speculative price increases. At the same time, rains are favorably affecting soybean development and corn pollination, so local agencies continue to raise production forecasts.

Abiove revised its forecast for soybean production in Brazil up by 3 million tons to 171.7 million tons, exceeding the USDA estimate of 169 million tons. The export forecast was also raised by 1.7 million tons to 106.1 million tons.

March soybean futures on the Chicago Board of Trade rose 3.2% yesterday to $392.2/t (+9.5% month-on-month), receiving speculative support from weather conditions in South America.

Soybean exports from the US fell 18% to 973.2 thousand tons in the week, but totaled 32.3 million tons for the season, up 20.6% from last year. The increase was driven by strong shipments to China early in the season, when importers were anticipating possible tariffs from the Trump administration.

In Ukraine, export prices for GMO soybeans continue to rise, rising by another $3-5/t to $380-382/t or UAH 18,000-18,200/t with delivery to Black Sea ports. This is due to limited supply from farmers and an increase in the number of exporters making purchases.

Export prices for non-GMO soybeans have risen to $400-405/t or UAH 19,300-19,500/t delivered to the western border of Ukraine. At the same time, demand from European buyers remains limited, and the premium for the absence of GMOs is minimal. Processor prices remain stable at UAH 18,500-19,000/t delivered to the factory.

The market is awaiting the Trump administration's decision to impose tariffs on goods from China, Canada, and Mexico. This could significantly impact soybean and corn markets, reducing export demand for American products.