Soybean Prices Fall to Two-Month Low Amid Record US Harvest and Weaker Oil

Soybean prices fell by more than 1 per cent on Monday, touching a two-month low. The decline was primarily driven by supplies from a record US harvest entering the market alongside lower crude oil prices.

The most-active soybean contract on the Chicago Board of Trade (CBOT) lost 1.2 per cent to reach $12.41-1/4 a bushel by 0338 GMT. Earlier in the session, the contract hit its weakest level since August 26. Prices had previously found support last week from strong export demand and higher crude oil prices, with crude oil frequently influencing agricultural markets due to the increasing use of grains and oilseeds in biofuel production.

Market participants noted that seasonal pressure is mounting as the US harvest gathers pace. A Singapore-based trader stated that there are currently not many supportive factors for prices.

Data from the US Department of Agriculture reported on Thursday showed net export sales of US soybeans at 2.8 million metric tons for the week ended October 15, supported by a series of Chinese purchases. However, the advancing US harvest continues to weigh on the market.

Other agricultural commodities also saw downward movement. Corn gave up 1.1 per cent to trade at $4.51 a bushel, pressured by the advancing US harvest which is expected to bolster large stocks further. Wheat edged 0.4 per cent lower to $6.22-3/4 a bushel, though its losses remained limited due to ongoing disruptions in Black Sea supplies.

The wheat market previously saw liquidation by investment funds following US-led diplomacy aimed at ending the war between Russia and Ukraine, which had initially raised hopes for a revival of Black Sea grain trade. Despite these talks, attacks have persisted, including a recent drone strike that sank a cargo ship off the Romanian Black Sea coast.

Meanwhile, crude oil prices declined after surging to near six-month highs late last week, though supply concerns remained in focus due to ongoing attacks on Saudi Arabia.

"Commodity price fluctuations, such as the recent drop in soybean values due to seasonal harvest pressures and energy market shifts, highlight the direct link between global supply chains and macroeconomic factors. For businesses operating in agriculture and related sectors, managing inventory and monitoring international trade dynamics remains crucial during periods of high supply volatility." — Dr. Shishir Gupta, Founder & CEO, StartupLanes