Soybean Prices Rose Due to Stronger Soybean Oil Export Sales


Mar. 11 2016, Published 7:14 a.m. ET

Soybean prices rose

Soybean prices on the CBOT (Chicago Board of Trade), for March expiry, rose slightly by 0.20% and settled at $8.81 per bushel on March 10, 2016. Soybean futures received a boost from strong soybean oil exports. The Teucrium Soybean Fund (SOYB) rose by 0.63% on March 10, 2016, with the rise in soybean prices on the CBOT.

The U.S. Department of Agriculture released the Weekly Export Sales report for the week ending on March 3, 2016. The net weekly export sales for the week from February 26 to March 3, 2016, were 475,180 metric tons for 2015–2016. It was 8% higher that the previous week and 2% above the prior four-week average. The primary destinations for the increase in soybean exports were the Netherlands, Indonesia, China, Taiwan, Japan, and Tunisia. There were reduced exports from Egypt. For 2016–2017, 3,300 metric tons of soybean exports were reported for Japan. The soybean exports were at the low end of the estimates. However, soybean oil exports were 35,000 metric tons. They were significantly higher than the upper bracket projection of 10,000 metric tons. It supported soybean prices on the day.

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Soybean harvests in Brazil are progressing rapidly with favorable weather conditions. Parana, a Brazilian state, recorded the highest weekly harvest pace of 14%. It completed 65% of the harvesting activity compared to 52% during the same period last year, according to the report from the Department of Rural Economics. It estimates that soybean harvests would be completed by March 2016. It expected that wet weather conditions during the harvest could negatively impact the output. Parana accounts for about 20% of Brazil’s soybean production. It supported US soybean export sentiments on March 10.

Concerned fertilizer companies

The increase in soybeans helps fertilizer companies with the sentiment of increased sales. Farmers’ income rises. On March 10, 2016, the stock prices of Monsanto (MON) and Chemical & Mining Co. of Chile (SQM) rose by 0.30% and 3.7%. In contrast, the share values of PotashCorp (POT) and Terra Nitrogen Company (TNH) fell by 3.9% and 1.4% on March 10, 2016. The MSCI India Total Return Index (INP) fell by 1.3% despite the rise in soybean prices on March 10, 2016.


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